Spanish banks starting to give mortgages

It appears that finally banks are starting to lend again to those looking at buying Costa del Sol properties. Although more demanding of proof of income, etc… slowly but surely the financial taps are being opened, with up to 100% offered in certain cases.

Although not frequent 100% mortgages are available if the buyer has guarantors, takes out several insurances and so on and so forth. As you can imaging different banks have different requirements, but the important thing is that the money is starting to flow.

Although we personally have not recently dealt with anyone who has achieved 100% in several cases buyers have received 80% mortgages on the sales price and in one or 2 cases on the valuations.

Bank requirements

To receive the maximum mortgage from the bank the following is normally needed.

1. That the mortgage equal no more than 40% of the household income. Pay slips from the last 6 months are normally required plus proof of a fixed contract. For the self-employed, normally 2 years of accredited accounts are needed.

2. A guarantor is needed in case the borrower is unable to make the payments. If there is no guarantor, property assets can be used as a guarantee.

3. The length f the mortgage is normally quite high, anything from 35 to 40 years.

4. The bank will expect you to have an account with them for your salary to be paid into. This account would also be used to pay utilities and other charges by direct debit.

5. Taking out a life insurance policy or mortgage insurance to cover any outstanding payments in the case of injury or death.

Hope this information has been of some help to those looking for mortgages. Please note this is based on our direct experience and can vary depending on the bank.

Andrew Bellés

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