GrapeEater

OK, There must be people having just taken or want to take Spanish Mortgage...

So as I am sorting / filing documents here I just came across a Quote for a mortgage - granted it's about 4 years old but:
1) It may be helpful to compare then and now
2) Other potential buyers may not know the hidden costs

This is a summary of what we asked for 4 years ago at a well known bank in Murcia. (We never took this out and circumstances changed)....

15 years on 80,000 €uros
- rate then was @ 3.5%
= Monthly payments about €570
+ Opening fee 0f 1% and + all taxes and fees* came to a whopping €18,697
* (notary, IVA, AJD, land register, bank solicitor, house insurance)

... it's a bit expensive taking out a mortgage in Spain is it not ??

cricketman

yes you have to take a huge hit on taxes and notary fees both on the motgage and transfer of the property. It will usually come to 9-12% of the purchase price of a second hand property

Plus given that rental yields are so low in Spain it makes no sense to buy for an investment (at the moment)

JLFS

Very interesting quote, and the 18,697 euros on top is one of the reasons why prices were so over inflated.

Even if you only lived in the property for one month, to "come out even" you would have to sell the property for 98,697 euros.

If the property changed hand in a short period of time and everybody wanted to get back what they actually paid in total with the costs and taxes included, the asking price would skyrocket. Estafa?????????

pete_l

And the rest. Don't forget when you sell it, the estate agents will want about 6% of the selling price, so add another <fx: gets calculator ... tap tap tap > nearly 6k. So the house you buy for 80k would have to sell for over 104k just to break even.
Which is why it takes on average 2 - 3 years (depending on location) to sell a place in Spain. You have to wait that long for appreciation to catch up with the asking price.

Bakeja

What annoyed me when I got a Spanish mortgage was the tax I had to pay (on the mortgage, besides the IVA on the property). My solicitor explained that it was a nice easy way for the government to raise money because it couldn't be avoided (you can't under-declare a mortgage) and is simply added onto the loan so is always funded. Very unfair to tax someone who needs a loan and not the (richer) people who don't.
Grumble , grumble.

HBG

There are some good deals available now, the prices are low, the mortgage rate is getting lower, you can negotiate like never before, and if you can't wait for even lower prices, you can get a bargain now, but only if you're buying a place to live in for ten years at least.

If you're a speculator, you're in the wrong place at the wrong time.

helenba

hi there dont get a morgage get a loan instead we did 4yrs ago now for our property less hassell payments dont change much the loan is over 15yrs less paper work .