If you’re a non-resident who is thinking about buying a property in Spain and you need a mortgage it’s not the same as having one approved in your home country, but it can be done.
Banks in your home country may be unwilling to lend you money to buy a property abroad and it may be difficult to organise one in a country where you don’t live or speak the language.
The good news is, however, that it is possible to contract a mortgage with a Spanish bank, even if you’re a non-resident, although the conditions will be slightly different from those for locals or residents.
Points to remember when contracting a non-resident mortgage in Spain is that the conditions will be slightly worse than the mortgages offered to residents. This is because you are seen as a greater risk if you live abroad, and the banks cannot as easily get the money from you if you don’t pay up. There are certain conditions that apply to non-resident mortgages. These include:
  • Financing: Most banks will lend non-resident up to 70% of the sale or appraisal value of the house or apartment you are going to buy, although some lower that percentage to 60%. Those who live in Spain, on the other hand, can get up to 80%.
  • Maximum term: In general banks will offer you a 20-year plan, although some financial institutions will offer you up to 30 years.
  • Higher interest: The interest rate on these types of mortgages is usually higher than those available for residents. Some banks will offer to lower your interest if you contract other products such as insurance or bank cards, although these will cost you more money.
  • Starting fee: Some banks will charge you a mortgage starting fee, the cost of which is usually a percentage of the amount of the loan. Spanish or resident foreigners, on the other hand, are often not charged this fee.
  • You need to consider when looking for a mortgage, banks don’t work on income multiples they work on affordability and the percentage of your NET income they will allow to cover credit commitments can vary between 25% to 40%, which can make a difference on the maximum you can borrow from one lender to another.
There are many different banks in Spain that offer mortgages for non-residents and its worth speaking to a specialist Like Viva Costa as the criteria varies vastly from one bank to another and we can help take the leg work out of finding the right lender
We received this email from a client who completed this week.
“It is now official; we have now completed the purchase. Thanks to both of you for all your help, your knowledge, your advice, you have both been so supportive and without your help this would never have happened”.
If you are looking to buy a property in Spain and need a mortgage, email mark@vci-network.com for the latest criteria
We have been working with UK mortgage brokers helping their clients for over 20 years