A Guide to spanish mortgages

In Spain, foreigners and non-residents can apply for a mortgage with Spanish banks.  We can recommend local solicitors based In Marbella (Manzanares) that can assist you in finding the mortgage option most suited to your needs.  In order to obtain a Spanish mortgage, you will need to meet a series of requirements: 

•  The mortgage repayment will never exceed 30% - 35% of the net monthly income of the applicant and the maximum re-payment period is 30 years.  Mortgages are normally granted until the age of 70-75.
• The bank will commission an official, certified, and independent valuation Company, to carry out a property valuation.  This Company will provide an official report on the value of the property, which becomes the main direct guarantee for the recovery of the loan in case of non-payment.  Regarding the mortgage amount, the official loans offered by banks are, generally, up to 60%-65% of the valuation value of the property for non-resident clients and up to 80% for residents.  As with any mortgage, the property acts as the main guarantee.  If the client cannot meet payments, the mortgage lender can execute the property, and eventually, repossess it and sell it to recover its loan.
• The most common type of mortgage in Spain is the capital and interest or repayment mortgage.  In capital and interest mortgages, the loan is returned by paying part of the capital monthly, together with interests generated.  This way, the loan is returned completely once the repayment period has ended.
• To apply for a mortgage, you will need the following documents, depending on whether employed, self-employed or retired.

Retired 

Last 3 pension slips

Tax return from last 2 tax years

Bank statements for the last 3 months

Reference letter from bank  

• Apart from the monthly interests and repayments, there may be costs related to setting up a mortgage in Spain, like the opening commission, insurance, legal fees, etc.  Another legal requirement is purchasing an insurance policy on the property and its contents.

We recommend Manzanares Lawyers in Marbella.  The above information is provided by Manzanares and is taken from their Legal Guide – Buying a Property in Andalucia, Spain