5 key things to think about when considering a Spanish mortgage

For many of our clients, finally being able to buy their property in Spain is a long-awaited dream come true. However, some of them may find themselves in need of a little extra financial help in order to make the purchase happen.

Choosing to take out a Spanish mortgage in order to afford a home in Spain is becoming more and more common. In fact, up to 40% of people buying a Spanish property, whether for a holiday home, investment property, retirement getaway or permanent residence, will opt for some form of financing to raise the necessary funds.

With Spanish mortgages now being more in demand and affordable than ever, we’ve put together a list of 5 key things to consider when thinking about applying for a Spanish mortgage.

1 – How much do you need to borrow?

It may sound obvious, but knowing roughly how much you need to borrow is important when considering any type of funding. Typically, you can borrow up to 50% of your property valuation with a Spanish mortgage, which is less than if you were buying over here with a UK mortgage.

Because of this, it is essential that you know where the rest of your investment is coming from, whether that’s money saved in the bank or from the sale of a property. Another option that is gaining in popularity is choosing to release equity on an existing property. If you would like more information on this option, a member of our team would be happy to talk to you. Call us today on 01202 971614.

Once you know how much you have ready to invest, and how much you need to borrow on your Spanish mortgage, we would be happy to put you in touch with one of our long-term recommended finance partners. Click here to contact us.

2 – How much are you prepared to spend on your Spanish mortgage repayments?

Spanish mortgage repayments may actually be more affordable than you’d think! We have long-standing relationships with finance providers who will charge interest rates at as little as 2% (sts), which is lower than ever for these types of mortgage.

If you’d like to see some real-life examples of the financial breakdown of a Spanish mortgage, each month we provide a mortgage example on properties of varying prices and locations. You can view the latest example on a Spanish property worth €205,000 here>>.

3 – Have you thought about investments?

If you’d like to pay your mortgage off even quicker, renting your Spanish property out to UK holidaymakers can be an excellent investment, particularly if you can make your property available for rental during the peak UK school holiday weeks.

Rental properties, particularly in Costa Blanca and Murcia, are in demand more than ever for sun-seeking Brits. In fact, there are already over 4 times more people requesting summer 2019 rental properties than there are actual properties available to rent!

With an average 2 bed Spanish property fetching a minimum of €400 per week as a holiday rental, we’d be happy to discuss this with you, or put you in touch with a reputable rental company.

4 – Are you dealing with a reputable finance provider?

When considering any amount of finance, it is crucial that you’re dealing with a trustworthy, knowledgeable and established mortgage provider. The sad truth is that there are a number of companies out there who would be happy to offer you finance whilst hiding hidden fees, or extortionate interest rates.

At Spanish Legal Homes, we make sure that we will only ever recommend the most reputable Spanish mortgage providers to our clients. Due to our position as a well-established Spanish property company with over 34 years’ experience, we maintain long-term relationships with the companies that are not only the most reliable, but can offer the best rates to our clients.

5 – Are your timescales reasonable?

We always recommend having your finances in place before you decide to embark on a viewing trip to Spain whenever possible. Therefore, knowing the right finance route to take and the timescale involved is extremely important.

Spanish mortgages can often take a little longer to process, so if you know that this is the route you wish to go down, you may want to start your application as soon as possible.

Discuss a Spanish mortgage with one of our friendly advisors

If you’d like to learn more or have any questions about how a Spanish mortgage could benefit you, we’d be happy to help. You can contact us by clicking here, or calling us on 01202 971614..