Frequently Asked Questions

What steps are involved in getting a mortgage in Spain?

Do I need to be in Spain to get a mortgage?
No, everything can be taken care of by our mortgage brokers in Spain.

Which documents and registrations are required?
To buy property and get a mortgage, you need to get a N.I.E identification number at the local spanish police station. Other required documentation may include copy passport, recent bank statements, recent tax statements, proof of income and/or statement by employer. If you are self-employed, you may be asked for recent anual reports and/or tax and VAT statements.

Different kinds of mortgages, amount, loan terms and interest rates?

Kinds of mortgages
The two basic types of mortgages, repayment and interest-only mortgages, are by far the most popular types of mortgages in Spain. The difference between them is that you do not pay off an interest-only mortgage, you only pay interest and the loan amount remains constant. Repayment mortgages on the other hand, are paid off in full, or in part, over the term of the loan.
Generally speaking, interest-only mortgages are used when the property is bought primarily for investment purposes.

Special types of mortgages are available when you are remortgaging an existing property in Spain or when you are selling your old house in Spain to buy other property in Spain. For more information about these special mortgages, please contact mortgages@libercasa.com.

Maximum loan
Spanish banks do not lend 100% of the property value to foreigners. You need to have savings of your own to invest in the property and to cover for the purchase cost. Generally speaking, the maximum loan is 70% of the property purchase price or the property valuation. Total purchase costs are around 11% of the property purchase price.

As a rule of thumb, if you can't cover the purchase costs plus 30% of the purchase price, then you can't buy the property. On the other hand, if you can come up with this amount from your savings, then our mortgage brokers can try to get you a higher maximum loan.

Loan terms
Repayment mortgages generally have a loan term of 25 years. Some banks restrict the maximum loan term to the difference between 65 (or 75 in some circumstances) and your age now. If you are 55 today, then some banks will only grant you a 10 year mortgage. As a consequence, the monthly payment of this mortgage will be considerably higher. Our mortgage advisors have plenty of experience with this issue and can generally find a satisfactory solution.

Interest rates
The interest rates on mortgage loans are usually linked to the Euribor rate. Euribor is a standard rating used by European banks. The interest rate on a mortgage loan can be fixed for one to five years to reduce the risk associated with interest rate fluctuations.

Loan approval criteria

Different banks and financial institutions use loan approval criteria that differ in many important respects. You will not necessarily notice this if you are the perfect applicant: fluent in Spanish, 35-45 years old, gross income of more than € 50,000, solid employment record and clean credit record. Otherwise, it may save you a lot of time and money to ask a professional mortgage advisor to select a mortgage that suits you situation. Fill in this form to receive this initial consultation free of charge

Income
Do you have income? How much? Can you prove that by showing employment contracts, tax statements, bank statements or similar?

Minimum income
Many (though not all) banks require a minimum income to get approved. A total gross income of the first and second applicant combined of € 50,000 is almost always sufficient.

Credit history
Some banks check the credit history of all applicants, including foreign applicants, for signs of less than perfect credit.

Age
Most mortgage contracts in Spain end when the applicant turns 65. In some cases the maximum age is 75.

The applicant is a registered company
Generally speaking, mortgages to recently founded companies are not approved.

How Libercasa can help

Libercasa is affiliated with a mortgage broker in Spain. This broker employs native english speakers with 20 years of experience as a mortgage advisors. They are based in Spain and have direct access to all major banks and financial institutions. We have spoken to a number of their customers all of whom were very satisfied with the service they had received.

If you have a question, that is not listed in this faq, please send it to mortgages@libercasa.com.

When you are serious about mortgage financing, ask our mortgage brokers to select a mortgage for you and send you a free official bank quotation within 24 hours.

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