Question about spanish mortgages on new build property
Aug 23rd 2010, 11:26 am
#1
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Thread Starter
Joined: Aug 2010
Posts: 3
Question about spanish mortgages on new build property
Hello forum folks!
I have a question about how Spanish mortgages work in relation to new build property (i.e. property that's under development).
Basically I have been told that in Spain, if you get a mortgage to build a new property, that you do not get the whole amount of the mortgage up front, but instead you get it in stages, after satisfying the mortgage lender that certain milestones of the build have been completed.
For example you get a mortgage of 100K, they give you 20K to get started. Then say in 6 months, once some "official" (maybe an architect) signs off that the foundations have been correctly laid, you get another 20K and so on until the property is built. Is this correct?
The reason I ask is that I lent someone some money towards their new build Spanish property on the proviso they were due to receive another "stage payment" from their lender and couldn't get next said payment until the current stage of work was complete (for which they needed my money). Just wanted to check if this sounds accurate.
Thanks for any help!
I have a question about how Spanish mortgages work in relation to new build property (i.e. property that's under development).
Basically I have been told that in Spain, if you get a mortgage to build a new property, that you do not get the whole amount of the mortgage up front, but instead you get it in stages, after satisfying the mortgage lender that certain milestones of the build have been completed.
For example you get a mortgage of 100K, they give you 20K to get started. Then say in 6 months, once some "official" (maybe an architect) signs off that the foundations have been correctly laid, you get another 20K and so on until the property is built. Is this correct?
The reason I ask is that I lent someone some money towards their new build Spanish property on the proviso they were due to receive another "stage payment" from their lender and couldn't get next said payment until the current stage of work was complete (for which they needed my money). Just wanted to check if this sounds accurate.
Thanks for any help!
Aug 23rd 2010, 11:33 am
#2
221b Baker Street
Joined: Jun 2010
Location: Miles from anywhere, Victoria, Australia.
Posts: 14,125
Re: Question about spanish mortgages on new build property
Hi there and welcome to B.E. 
It's my pleasant duty to welcome you to the forum and give you a point of contact should you need any help with the site in general. You can contact me here.
A list of all the moderators and helpers with their relevant countries including Spain can be found here.
Any problems, dont hesitate to PM me.
I can't speak for Spain but if what you have been told is correct then it is no different to the UK when it comes to new builds.
Alistair.
It's my pleasant duty to welcome you to the forum and give you a point of contact should you need any help with the site in general. You can contact me here.
A list of all the moderators and helpers with their relevant countries including Spain can be found here.
Any problems, dont hesitate to PM me.
I can't speak for Spain but if what you have been told is correct then it is no different to the UK when it comes to new builds.
Alistair.
Aug 24th 2010, 3:05 pm
#4
BE Enthusiast
Joined: Oct 2007
Posts: 446
Re: Question about spanish mortgages on new build property
Hello forum folks!
I have a question about how Spanish mortgages work in relation to new build property (i.e. property that's under development).
Basically I have been told that in Spain, if you get a mortgage to build a new property, that you do not get the whole amount of the mortgage up front, but instead you get it in stages, after satisfying the mortgage lender that certain milestones of the build have been completed.
For example you get a mortgage of 100K, they give you 20K to get started. Then say in 6 months, once some "official" (maybe an architect) signs off that the foundations have been correctly laid, you get another 20K and so on until the property is built. Is this correct?
The reason I ask is that I lent someone some money towards their new build Spanish property on the proviso they were due to receive another "stage payment" from their lender and couldn't get next said payment until the current stage of work was complete (for which they needed my money). Just wanted to check if this sounds accurate.
Thanks for any help!
I have a question about how Spanish mortgages work in relation to new build property (i.e. property that's under development).
Basically I have been told that in Spain, if you get a mortgage to build a new property, that you do not get the whole amount of the mortgage up front, but instead you get it in stages, after satisfying the mortgage lender that certain milestones of the build have been completed.
For example you get a mortgage of 100K, they give you 20K to get started. Then say in 6 months, once some "official" (maybe an architect) signs off that the foundations have been correctly laid, you get another 20K and so on until the property is built. Is this correct?
The reason I ask is that I lent someone some money towards their new build Spanish property on the proviso they were due to receive another "stage payment" from their lender and couldn't get next said payment until the current stage of work was complete (for which they needed my money). Just wanted to check if this sounds accurate.
Thanks for any help!
We bought the plot outright (with cash) on which our villa was built in 2001, and over the next 18 months, the Spanish Bank with whom we took out a mortgage for the build, paid various sums on our behalf directly to the builder once they were satisfied that the necessary work for that 'stage' had been completed ...
Aug 24th 2010, 4:37 pm
#5
Just Joined
Thread Starter
Joined: Aug 2010
Posts: 3
Re: Question about spanish mortgages on new build property
Thanks for your reply. Apparently the work or at least that stage of work was not signed off, this seemed to be due to a dispute with the architect, hence the money not being paid by the bank.
In this case the money was due to be paid not directly to the builder, but to my friend (whom I lent the money) who was commissioning the builder, as an employee, as it were. To my knowledge there has been no dispute with the builder.
Anyway thanks it sounds like this stage payment thing is genuine.
In this case the money was due to be paid not directly to the builder, but to my friend (whom I lent the money) who was commissioning the builder, as an employee, as it were. To my knowledge there has been no dispute with the builder.
Anyway thanks it sounds like this stage payment thing is genuine.
