Posted March 25, 2024 & filed under marbella mortgage mortgage advice in spain
Have you been dreaming for years to escape the rat race, but don't want to use all your hard earned money, well now it's the time to do it! In 2024 the interest rates for mortgage loans in Spain are expected to go down to very exciting rates for buyers. So, if you are you considering purchasing a mansion in Zagaleta or Sierra Blanca, a villa in Nueva Andalucia or a property in Southern Spain, particularly in the vibrant city of Marbella, understanding the ins and outs of securing a mortgage is crucial. Here's a comprehensive guide to Marbella mortgage advice, covering everything from eligibility criteria to associated costs.
Many Spanish mortgage lenders have no restrictions on the purchase price or the nationality of the applicants, though Spanish banks often favor applicants from the EU countries and United States. However, banks are increasingly open to working with individuals from other regions.
One significant distinction between residential and non-residential loans is the maximum loan-to-value (LTV) ratio and for non-residents who are paying taxes outside Spain, the maximum mortgage amount typically ranges from 60% to 70% of the property's purchase price. Conversely, fiscal residents who pay Spanish taxes can usually borrow up to 80%.
Andalusia, followed by some of the big cities up north such as Madrid and Catalonia, traditionally sees the highest number of mortgage loans for home purchases, according to the National Institute of Statistics.
Types of Mortgages: Spain offers various mortgage options, including those tailored for expatriates by international and Spanish banks. Most Spanish mortgages feature variable rates linked to the yearly Euribor plus a margin. Fixed-rate mortgages are also available, typically ranging from 2.4% to 3%, depending on the loan term. In case of non-repayment, the property itself serves as collateral.
Resident / Non-Resident Expats: "Spaniards living abroad and non-resident expats often face higher interest rates compared to residents, Non-residents may find it challenging to meet certain requirements, such as maintaining a bank-associated life insurance or having their salary deposited in a Spanish bank.
To secure the best deal, some experts suggest leveraging competition among lenders. Taking a mortgage offer from one bank to another can prompt competitors to provide more favorable terms, a practice applicable even with Spanish banks.
Mortgage Application Process in Marbella: For those considering a mortgage in Marbella, it's essential to understand the prerequisites. While the process may vary slightly from lender to lender, certain general requirements apply:
Documents required for a Spanish mortgage application typically include ID and NIE, a pre-agreement with the seller, proof of employment or income, up-to-date property tax records, details of existing debts and mortgages, records of assets, and any relevant prenuptial agreements.
Costs Associated with Marbella Mortgages: Securing a mortgage in Marbella involves various expenses, including:
It's advisable to allocate approximately 10-15% of the property's purchase price for these transaction costs.
If you want to chech the monthy repayment cost on your next property purchase in Marbella and the Costa del Sol, please check our mortgage calculator
Conclusion: Navigating the mortgage landscape in Marbella and Spain requires thorough research and understanding of the process. By adhering to eligibility criteria, preparing necessary documents, and factoring in associated costs, you can secure a mortgage that aligns with your financial goals and property aspirations. For personalized guidance and assistance, trusted advisors are available to provide expert mortgage advice throughout the journey. Contact Xcape Today, to start making your dream come true!