Table of Contents
Spanish Mortgages
Step by Step Guide to apply for a Spanish Mortgage:
1) Decide on a property. Sign the Contrato de Compraventa and transfer the initial deposit with Baydonhill FX to secure the property.
2) Obtain a NIE number through your appointed legal representative or estate agent.
3) Obtain a Nota Simple from the land registry.
4) Submit full mortgage application to BIM with all required supporting documentation in order to obtain financial approval.
5) Obtain full approval for your mortgage application, upon return of a positive valuation report from the bank’s appointed surveyor.
6) Receive Mortgage Offer letter from the Lender confirming terms of mortgage
7) Set up an International Regular Payment Plan with Baydonhill FX to cover monthly mortgage repayments, utility bills etc and give you greater peace of mind.
8) Transfer purchase price balance and legal fees to your Notaire through Baydonhill FX
9) Attend mortgage completion at the Notary’s office, or else arrange a Power of Attorney to do this on your behalf if you are not able to be present. The Notario will register the mortgage and release the funds to the designated beneficiary.
Back to top
Eligibility & criteria
All mortgages are in Euros and will be secured on your Spanish property. Mortgages are full status and proof of income and outgoings will be required.
The maximum loan to value available is 60% of the value of the property and some lenders will include fees. Our minimum loan amount is €100,000.
Spanish lenders assess eligibility on the applicant's capacity to repay the loan. As a guideline, your existing monthly outgoings and the repayment on your Spanish mortgage should not exceed 35% of your net monthly income. A percentage of rental and investment income can also be considered. Mortgage, rent, personal loans, credit card payments, child maintenance and alimony, commitments are considered as outgoings. Speak to our Spanish consultant to find out the maximum that you are able to borrow.
Back to top
Types of Spanish Mortgages
Mortgages can be obtained for the purchase of off-plan, new or existing properties.
Spanish lenders will consider applications in the name of an English or Spanish Company. This is not widely available and will be at the lender’s discretion.
For construction loans, plans must be provided at the time of application. You will need to be the owner of the land before applying for the loan. Funds will be released by the lender directly to your builder in accordance with the plans and following the bank’s valuation to ensure the agreed stage has been reached.
Capital raising is available on your property in Spain and the amount you can borrow will be determined by a valuation arranged by the lender. The purpose of the release of funds needs to be disclosed upfront, although many lenders will not follow up on this at completion.
The refinance of your existing Spanish mortgage in order to take advantage of a more competitive interest rate is possible. However, refinancing will incur both costs at the Notary office and with the new lender. Certain lenders may offer to cover these costs, making the proposition more attractive.
Back to top
Spanish Mortgage Products
A variety of products are available ranging from capital repayment mortgages or a combination of capital repayment and interest-only on a variable or fixed-rate basis or a combination of both. Most mortgage rates are indexed against the Euribor. Terms can be from 5 to 40 years. However, loans must be repaid by 70 years of age. Many of our products do not have any early redemption penalties. For an initial idea of rates and monthly repayments, use our quick quote online mortgage calculator, or else complete a personalized quotation request form and we will send you a tailored quotation.
Back to top
Timeframe
A decision in principle can be obtained from a lender once all the requesteddocumentation has been submitted. This takes approximately 5 working days.
A minimum of 6 weeks should be allowed from application to completion.
Back to top
Documentation required
Spanish lenders are legally required to request full documentation proving that the borrower can afford the mortgage repayments, and therefore you will be required to submit a significant number of supporting documents. However, many Spanish lenders will also carry out a credit check to confirm your outgoings here in the UK, and in many cases this will reduce the number of documents required. Please see below for a summary of what will be required. A detailed list will be compiled based on your situation and sent to you with your personalised quotation.
* Proof of identity & residence
* Proof of income & outgoings
* Bank statements
* Property details
Back to top
Buildings insurance
Buildings insurance is mandatory and needs be in place for completion. Most lenders offer their own buildings insurance and if their provider is not used, they will require proof that the policy has been assigned to them. Baydonhill Insurance can provide you with a quote for this.
Back to top
Life assurance
Life assurance is strongly recommended but not obligatory with all of our lenders.
Back to top
Spanish Bank account
Most lenders will require you to have an account open with them.
Back to top
Spanish Monthly Mortgage Repayments
Please be aware that missing a monthly mortgage payment may have serious consequences and we therefore strongly advise participation in our overseas payment plan. This service gives you peace of mind in the knowledge that your Spanish mortgage repayments will be met automatically each month.Back to top
Completion
Mortgage funds will be released by the lender to your Notary for completion of the purchase.
Back to top
£1 = 
$1.5137 / 
€1.1770
