Taking out a mortgage in Spain
#1
Just Joined
Thread Starter
Joined: Feb 2015
Posts: 1
Taking out a mortgage in Spain
Hello everyone, I am new to here and would appreciate a steer in the right direction as not having much luck elsewhere at the moment please. I am looking to buy a house in Spain, initially as a holiday home for 2/3 years before relocating full time. I need to take out a small mortgage though in the meantime and am looking into the option of obtaining the mortgage from a Spanish bank rather than a UK bank/lender. I am not interested in remortgaging my UK property to raise the finance, (which is all I can seem to find in UK so far). I would appreciate any guidance please.
Many thanks.
Many thanks.
#2
Re: Taking out a mortgage in Spain
Hi and a warm welcome to the Spanish forum on BE. Myself and Fred James are the moderators for the Spanish forums whilst BEVS moderates Europe. Moderators are there to ensure that the site runs smoothly within the rules of BE. This is so that members gain the information that they are looking for and find their experiences on the forums to be friendly and worthwhile.
Problems and complaints should always be addressed to a moderator who will look into the matter and deal with it efficiently and fairly. Our members who post in the Spain Forums are usually friendly and helpful with a wealth of knowledge about the issues of living in Spain. I hope that you enjoy your time participating in the forums.
Please let me know if you need any further help.
Rosemary
Problems and complaints should always be addressed to a moderator who will look into the matter and deal with it efficiently and fairly. Our members who post in the Spain Forums are usually friendly and helpful with a wealth of knowledge about the issues of living in Spain. I hope that you enjoy your time participating in the forums.
Please let me know if you need any further help.
Rosemary
#3
BE Forum Addict
Joined: Jun 2009
Location: Valencia area
Posts: 1,155
Re: Taking out a mortgage in Spain
Colin from what I know/read avoid a mortgage here & in your shoes I would look to source the funds from the UK.
#4
Re: Taking out a mortgage in Spain
I suspect most UK banks will be extremely reluctant to lend money to buy a property outside the UK as they will find it very difficult to make the legal checks, and with the dubiousness of many of the properties in Spain I forsee great problems
#5
Re: Taking out a mortgage in Spain
Your best bet is probably to look for a property owned by the bank. That way you are more likely to get a mortgage. There are plenty of reposessed properties around.
#6
BE Forum Addict
Joined: Jun 2009
Location: Valencia area
Posts: 1,155
Re: Taking out a mortgage in Spain
The OP speaks about a small mortgage & has it seems the option to take out a re-mortgage on the UK property.
#7
Re: Taking out a mortgage in Spain
Did you read his post? He specifically said he does not want a remortgage.
It might be useful to understand the point you are trying to make?
It might be useful to understand the point you are trying to make?
#8
BE Enthusiast
Joined: Aug 2007
Location: Los Martinez
Posts: 858
Re: Taking out a mortgage in Spain
The Leeds Building Society offer what they call a 'Euro Mortgage' (we have one) it is sourced via Gibraltar or it was- query this with the head office in Leeds! They give a mortgage for anywhere in europe but typically Spain/Portugal.
The downside is all payments have to be made in euro not sterling, so for us we have to convert sterling to euro through a currency broker each month who then pays that into your mortgage account.
As I have said previously on here, any branch of the Leeds B.S will take your mortgage payment over the counter, but it has to be paid in euro not sterling! This is a ballache but you get used to it. Ours has to be paid in full next year, we have yet to find a way to convert £90.000 into euro and transfer it to the Leeds, without falling foul of currency money laundering laws which state as an individual you can only move amounts of £10.000 at a time.
Of course your bank will do it for you, but at the last asking HSBC wanted close to £5000 to do this for us
The downside is all payments have to be made in euro not sterling, so for us we have to convert sterling to euro through a currency broker each month who then pays that into your mortgage account.
As I have said previously on here, any branch of the Leeds B.S will take your mortgage payment over the counter, but it has to be paid in euro not sterling! This is a ballache but you get used to it. Ours has to be paid in full next year, we have yet to find a way to convert £90.000 into euro and transfer it to the Leeds, without falling foul of currency money laundering laws which state as an individual you can only move amounts of £10.000 at a time.
Of course your bank will do it for you, but at the last asking HSBC wanted close to £5000 to do this for us
#9
Re: Taking out a mortgage in Spain
The Leeds Building Society offer what they call a 'Euro Mortgage' (we have one) it is sourced via Gibraltar or it was- query this with the head office in Leeds! They give a mortgage for anywhere in europe but typically Spain/Portugal.
The downside is all payments have to be made in euro not sterling, so for us we have to convert sterling to euro through a currency broker each month who then pays that into your mortgage account.
As I have said previously on here, any branch of the Leeds B.S will take your mortgage payment over the counter, but it has to be paid in euro not sterling! This is a ballache but you get used to it. Ours has to be paid in full next year, we have yet to find a way to convert £90.000 into euro and transfer it to the Leeds, without falling foul of currency money laundering laws which state as an individual you can only move amounts of £10.000 at a time.
Of course your bank will do it for you, but at the last asking HSBC wanted close to £5000 to do this for us
The downside is all payments have to be made in euro not sterling, so for us we have to convert sterling to euro through a currency broker each month who then pays that into your mortgage account.
As I have said previously on here, any branch of the Leeds B.S will take your mortgage payment over the counter, but it has to be paid in euro not sterling! This is a ballache but you get used to it. Ours has to be paid in full next year, we have yet to find a way to convert £90.000 into euro and transfer it to the Leeds, without falling foul of currency money laundering laws which state as an individual you can only move amounts of £10.000 at a time.
Of course your bank will do it for you, but at the last asking HSBC wanted close to £5000 to do this for us
Talking to our bank teller the other day about how much you could carry or transfer he said the limit for cash at borders or for paying in over the counter was £10,000. However if the transfer was bank to bank through proper channels then their is no limit. It's all about the money trail against money laundering. The beauty is they charge just €3 for the transfer and the exchange rate is the best I have found!
Last edited by EsuriJohn; Feb 9th 2015 at 6:54 pm.
#10
BE Forum Addict
Joined: Jun 2009
Location: Valencia area
Posts: 1,155
Re: Taking out a mortgage in Spain
So maybe (?) once he looks a little closer he may well opt for UK funds & of course this will give him more of an edge being a cash buyer.
So yes I did read his post, but did you read mine ?
#13
Forum Regular
Joined: Sep 2012
Posts: 246
Re: Taking out a mortgage in Spain
Apparently ING Spain is offering mortgages at euribor plus 1.49%. This article is in Spanish but mentions banks and mortgage rates as recently as January.
ING reduce el diferencial de su hipoteca al 1,49% - Expansión.com
ING reduce el diferencial de su hipoteca al 1,49% - Expansión.com
#14
Lost in BE Cyberspace
Joined: Feb 2008
Posts: 5,613
Re: Taking out a mortgage in Spain
At the moment it may look inviting for Spanish mortgage with the Euro being weak the OP may be lucky and it may stay that way for the length of the mortgage however it could move the other way. I bought with a Spanish mortgage similar circumstances however within 12 months the rate dropped from 1.40 to parity with £. I can assure the op there were many nights I wished I had done re mortgage. I had Undertood of ours currency fluctuations but not expected that amount of change and it has only now 7 years later got back near what it was. The other thing to consider is with a Spanish mortgage if you take say a ten year mortgage and pay the remaining amount off after say 3 years there are charges, these can be lowered by paying it off in a certain way but worth bearing in mind. Also once the final payment is made unlike in the UK where you get a letter from bank/building society saying they have informed land registry they no longer hold an interest in your property, in Spain you have to pay the solicitor or bank to have their interest removed which has to be done. Just some things to consider for peace of mind.
#15
Lost in BE Cyberspace
Joined: Apr 2009
Posts: 7,749
Re: Taking out a mortgage in Spain
At the moment it may look inviting for Spanish mortgage with the Euro being weak the OP may be lucky and it may stay that way for the length of the mortgage however it could move the other way. I bought with a Spanish mortgage similar circumstances however within 12 months the rate dropped from 1.40 to parity with £. I can assure the op there were many nights I wished I had done re mortgage. I had Undertood of ours currency fluctuations but not expected that amount of change and it has only now 7 years later got back near what it was. The other thing to consider is with a Spanish mortgage if you take say a ten year mortgage and pay the remaining amount off after say 3 years there are charges, these can be lowered by paying it off in a certain way but worth bearing in mind. Also once the final payment is made unlike in the UK where you get a letter from bank/building society saying they have informed land registry they no longer hold an interest in your property, in Spain you have to pay the solicitor or bank to have their interest removed which has to be done. Just some things to consider for peace of mind.
In any case, most Spanish banks will want proof of your Spanish income to give you a mortgage and may not take into account UK based earnings. It is also very difficult to get a mortgage if you are self-employed, they usually want to see your work contract