Obtaining a mortgage in Spain
There are 2 different categorizations of property in Spain:
Urban
Urban which basically means the property is in a fully developed area and contains such things as plumbed in water, mains electric etc.
Rustic
Rustic which basically means the property is situated in a rural area and often will not be equipped with such things as plumbed in water, mains electric etc.
Spanish banks lending percentages differ depending on whether the property to be mortgaged is rustic or urban. In general, it is possible to fund up to 80% of either the purchase price or valuation (whichever is lower) on urban properties. This percentage will drop slightly if the person applying for the mortgage is not a fiscal resident of Spain. With regards to rustic of either purchase price or valuation (whichever is lower) is the maximum a Spanish bank will lend. This percentage is not effected by whether the applicant(s) of the mortgage are fiscal residents of Spain or not but is largely dictated by the standard of the property and the quality of the properties legal documentation.
Costs
We normally reckon on the costs associated with your house purchase coming to about 10% but when a mortgage is involved there will be extra costs (valuation, arrangement, land registry and notary fees for a start) so you need to allow 12%. More importantly these costs will have to be paid from your capital. So, for example, if you buy a house for 100,000 Euros and have a valuation for this amount you can aim at a 70% mortgage. This leaves you with 30,000 Euros to find to complete the purchase price plus 12,000 Euros costs so the minimum capital needed would be 42,000 Euros.
A more likely however would be a valuation of about 75,000. Based on a 100,000 Euro purchase price the mortgage would be 52,500 leaving a shortfall to complete of 47,500 + 12,000 costs = 59,500
With over 30 years of working relationships with the major banks in Antequera, we can introduce you directly to banks, who can help you with mortgage applications.
