How Much Does A SPANISH MORTGAGE Cost?
How much does a Spanish mortgage cost?
A €500,000 mortgage on a €715,000 property in Malaga on a current 10 year fixed-rate of 5.15% over 30 years would cost €2,730.13 each month.
The mortgage opening fee or arrangement fee on this amount is 1% of the loan amount.
A property valuation is required which is often 0.095% plus VAT (21%) which would be €821.89 on a €715,000 property and it is the only amount that needs paying before completion. This not only helps give a guideline on comparative value of the property but also identifies legal issues that may need tackling.
There would be a principal transmission tax of 7% in the region of Malaga and the notary, registry and legal agent costs would be around €4,000.
How much does a £1 million Spanish mortgage cost?
A €1,000,000 mortgage would usually have slightly higher qualification conditions due to the extra provisions banks have to put aside to meet regulatory requirements. However, it would cost €5,460 each month over 30 years on a ten-year fix at 5.15%.
Home insurance through a provider like Liberty is required for the first five years. No additional products such as life insurance are linked to the mortgage.
Which documents would you need to provide for a Spanish mortgage?
Spanish banks would typically ask for the following information as part of the mortgage process.
Completed application form – or if you’ve got one you’ve done from another bank might save you doing another. Passports and NIE’s if available.
Work contract, last P60 or equivalent and last three payslips if employed. Last three years complete person tax returns and last three years company accounts if self employed.
Copy of tenancy agreement of any Buy to Let Properties, or portfolio excel if numerous.
Last six months bank statements where any incomes received and mortgages, loans or rent paid. Last six moths statements of savings and assets, also excel statement of assets and liabilities if numerous.
Copy of credit report showing current mortgages and loans. Or statement from the lender where doesn’t appear in report.
Advert and nota simple of property looking at and the property reservation agreement if completed.
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Frequently Asked Questions
Can I get a Decision in Principle for a mortgage if I have not found a Spanish property?
A huge number of buyers lose properties because they do not have the finance in place.
It is important to get a mortgage in principle agreed before you submit and offer to buy a Spanish property.
You can give the mortgage lender a guide to your budget and let them know the areas you like. The bank would work out the average property price in the area and they can then let you know the taxes you would pay.
How long does the process normally take to buy in Spain?
Our specialist can get mortgages agreed very quickly.
Once the mortgage application is submitted a decision in principle normally comes back within a few days. The property valuation often takes a week.
Once the mortgage and property is approved and the mortgage is offered it needs to be signed digitally.
The property can then be uploaded to the notary service which then starts the legal cooling off period in Spain which lasts for ten days.
After the ten days completion can happen at the notery providing the ‘transparency act’ document has been signed at least a day before completion of the purchase.
Am I allowed to let a property with a standard Spanish mortgage?
Most lenders allow homes to be let out when the owners is not staying there.
Can I get funding to build my own Spanish home?
Spanish lenders can provide self-build mortgages.
They typically expect the plot to be purchased with cash or a loan, after that they can fund up to 100% of the construction costs, with the funds being released in stages.
How much deposit do you need for a Spanish mortgage?
To a non Spanish resident buyers will need a 30% deposit, so 70% of the purchase prices.
Costs and fees will normally be between 8% and 14% of the purchase price.
Is there a minimum or maximum Spanish mortgage loan amount?
The minimum mortgage amount is normally €100,000 euros with no maximum loan size.
What sort of Spanish property can I purchase?
Spanish mortgage lenders prefer urban properties designed for residential use but they can also provide funding for rustic homes and investment properties
How much deposit do you need for a Spanish mortgage?
o a non Spanish resident buyers will need a 30% deposit, so 70% of the purchase prices.
Costs and fees will normally be between 8% and 14% of the purchase price.
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