Would i get a spanish mortgage

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24 Sep 2014 8:21 AM by rightmove Star rating. 42 posts Send private message

OK  ive seen a few properties i fancy in Murcia priced at around 50k euro ive got 10k euro to give as deposit.i get £1000pcm wage in the uk (but it wont be for long its temp work) i also get £1000pcm in the uk from a rental.Would the loan people ask my employer if my job was  permanent ? What sort of docs would the spanish mortgage company want of me as proof, i could repay. ive looked at getting a couple of loans in the uk but these want repaying in 5 years apx. Any thoughts





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24 Sep 2014 8:50 AM by eggcup Star rating. 567 posts Send private message

Do you have any equity in your UK rental? When we bought in Spain we usually did it that way, by raising money off UK rentals. It's a lot easier than trying to get a mortgage in Spain. They always want everything in triplicate. The only time we tried to get a mortgage in Spain it was on a finca worth at least 120,000 euros at the time, the Spanish bank valued it at 60,000, then would only lend us 30,000 and after we'd paid a few hundred in fees and were about to go over to the notary (after months of gathering and photocopying documents and having mind-numbing conversations with the bank manager who didn't know his arse from his elbow and must have been promoted because of who he knew), it was casually mentioned that we would now have to pay around a thousand euros extra in fees/notary charges (I forget which). We turned on our heels. The fees and charges were ridiculous. Reading other people's accounts it seems that they might also force you into buying their insurance policy which will be extortionate.

That's my limited experience of mortgages in Spain - and that was enough to permanently put me off.



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24 Sep 2014 9:14 AM by Mickyfinn Star rating in Spain and France. 1840 posts Send private message

Your 10k will not be enough. Firstly you will have to pay 12-13% in taxes just to buy the property. The Hacienda (tax office)  will almost certainly value the property higher for tax costs. Then you will require around a minimum 20% deposit since banks will only lend a maximum of 80% loan to value unless it's a bank owned property. You will have legal fees, utility set up fees and other incidental expenses.

Mortgage repayment costs will increase, as will the community charge on the property, none resident taxes and council taxes. You need to facture all that in over time. Even if you bought the property outright your running costs on average will be €2.5k per year, plusyour mortgage.

These are the realities no agent selling property will ever tell you unless you pin them down and even then they will spin it to you..



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24 Sep 2014 6:32 PM by rightmove Star rating. 42 posts Send private message

Ok thanks guys, i think i will rent. Cheers





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25 Sep 2014 3:17 PM by claire T Star rating in Torremendo, Orihuela. 689 posts Send private message

EOS Supporter

Hi - I am an agent and we always advise people about the problems in obtaining a Spanish mortgage.  If we didn´t then the sale would fall through and no-one benefits!

At the moment it is unlikely that a non-resident buyer will get more than 60% of the asking price or the bank valuation if lower.  We had a client recently who only needed 20,000€ mortgage and the fees were going to be 5,000€, so he proceeded with finance from the UK.

As has been said before, the banks may offer more on their own repossessions, but always check the local prices as repossessions are not always the cheapest!



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Claire



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25 Sep 2014 3:48 PM by acer Star rating. 1480 posts Send private message

You can also consider using a mortgage broker in the UK to get mortgage on your Spanish property.  This was certainly a good option for me a few years ago, but I don't know the current market.

As Mickyfinn says beware of the extra costs though.  We are currently buying and I've just received a note from the solicitor listing the costs:

Purchase tax (8%) €14,000

Resolution clause (whatever that is!) €1,875

Registration (again dunno what this is for) €600

Notary €900

Solicitor €1,452 incl IVE

So the €175,000 purchase ends up costing €193,827.  But I suppose that in fairness that's no different to the UK.  I haven't queried the Resolution clause or Registration fee yet, does anyone know if these are standrard and what they're for please?



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25 Sep 2014 3:50 PM by casperruby Star rating. 165 posts Send private message

Hi, when we purchased our property over a year ago it was said by the agent to be a "cheapie" we do not live on the coast infact half an hour north of granada.

The reason I'm writing is that mickyfinn mentioned in this post 2.5k euro house running costs no mortgage involved,  is this because the property is on the coast and large villa type as our fixed costs, insurance,  tax, council tax,  water , gas , , electric and bins etc are only a 3rd of that figure. 

In reply to the op. Look around theres loads of properties for sale uk borrowing is cheaper than spain look for a cheapie and liveable and gradually do it up.





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