February’s Spanish mortgage example for a Spanish property costing €243,000

 

The cold has definitely set in, with temperatures dropping as low as -1 degrees in the evenings across the UK. With this in mind, we decided to base this month’s Spanish mortgage example on a property located in sunny Valencia, which has highs of 23 degrees – even in February!

Read on for the benefits of having a Spanish mortgage, as well as real-life examples of the costings which show you just how affordable owning a Spanish property can be.

Daya Nueva, Alicante, Valencia

These large, bright and airy 3 bedroom villas have been built in a prime location in Daya Nueva, Alicante. Located only a short drive away from Alicante airport, these villas benefit from being part of an exclusive community which is close to sandy beaches, popular golf courses and local facilities. If you have decided to bring your car to Spain, or are looking to buy a new one once you’ve moved, you’ll be able to keep it safe and secure in one of your two off-road parking spaces within the walled gardens.

If you’re searching for the Spanish sun, these villas might be the perfect choice as the large living and dining room allows plenty of natural light in, thanks to high ceilings and tinted glazed doors. Whilst you’re sat enjoying breakfast in your open-plan kitchen with full length breakfast bar, you’ll be able to overlook the private, floodlit swimming pool and beautiful garden areas.

Each of the three double bedrooms comes with fully fitted wardrobes, with the master bedroom including a luxury walk-in dressing room. All of the bathrooms are modern, and the en-suite in the master bedroom even features an additional storage room. Also included is air conditioning, pre installed TV and internet, so you’ll never feel disconnected from your family or friends in the UK!

As with most of our newly built properties, you’ll feel secure with a 10 year architect’s guarantee. So with low yearly basic running costs, safe walled gardens, and beautiful beaches on your doorstep, what more could you want?

Is a Spanish mortgage right for you?

Once you’ve made the decision that you want property in Spain, the next thing to think of is how you plan to finance it. If you’re still undecided whether to take out a Spanish mortgage or not, you might want to consider the following benefits:

  • Rental repayments – Renting your property when you’re not using it could be a tactical way of paying back your Spanish mortgage repayments.
  • Speed up the process – A Spanish mortgage could be a quicker way of raising the finance needed to buy your property in Spain.
  • Increase your budget – With the excellent Spanish mortgage rates available, you may have the opportunity to increase your budget and purchase a bigger property, or a property in a different location.
  • Pay off your mortgage with no penalties – Offsetting the low value of the £ sterling means that when exchange rates improve, you can pay off your Spanish mortgage with no penalties.

If you want to learn more about the benefits of having a Spanish mortgage, let us put you in touch with one of our recommended mortgage advisors. Contact us >>

 

Spanish mortgage rate example, option 1

In our first example, we have allowed for the additional fees such as taxes, community fees and the legal fees that you will incur when you buy a Spanish property, to give you a more realistic mortgage figure.

Property price – €243,000
Estimated closing costs including all taxes & bank mortgage set up fees at approximately 15% – €36,450
Therefore the total cost of purchase – €279,450

Funds needed to complete (including 35% deposit value & fees) – €121,500 @ an exchange rate of 1.18 = GBP 102,966
Mortgage value (LTV) 65% – €157,950
Cost per month, capital repayment over 25 years @ 2% at the top end interest rate – €669 @ an exchange rate of 1.18 = GBP 556

In summary, you could buy this Spanish property using a 65% mortgage with a combined deposit and fee costs of €121,500 and monthly instalments of €669 over 25 years.

Spanish mortgage example, option 2

In our second example, we have allowed for the additional fees such as taxes, community fees and the legal fees that occur when you buy a property, however, we have added an extra 10% deposit value.

Property price – €243,000
Estimated closing costs including all taxes & bank mortgage set up fees at approximately 15% – €36,450
Therefore the total cost of purchase – €279,450

Funds needed to complete (including 45% deposit value & fees) – €145,800 @ an exchange rate of 1.18 = GBP 123,559
Mortgage value (LTV) 55% (Max lending for non-Spanish tax residents from the EU) – €133,650
Cost per month, capital repayment over 25 years @ 2% at the top end interest rate – €566 @ an exchange rate of 1.18 = GBP 479

In summary, you could buy this Spanish property using a 55% mortgage with a combined deposit and fee costs of €145,800 and monthly instalments of €566 over 25 years.

*Please check with an officially registered currency exchange company, such as our partners at A Place in the Sun Currency, for up to date exchange rates. The figures shown are for guidance purposes only.

 

Obtaining a Spanish mortgage on a property

If you think that a Spanish mortgage is the best option for you, let us help you move the process forward. The bilingual experts at Fluent Finance Abroad (FFA) will take some of your stress away by giving you further advice and liaising with the top high-street banks in Spain to get you the best exchange rates.

Financing your Spanish property in the UK

If you want to keep your finances closer to home, our UK advisors can offer unbiased guidance and assistance. From remortgages, equity release and loans, they can help release funds from the UK to assist towards your property purchase in Spain.

For more information, please contact us directly on 01202 971614 or register your interest here >>

Currency transfer

When buying overseas it is important to have plans in place on how to transfer funds to pay for the property. Some buyers use their UK bank but this will typically be charged at higher rates than a specialist currency broker.

We would recommend using a specialist such as A Place in the Sun Currency, as the savings you can make on exchange rate can be used to pay additional costs such as legal fees and furniture packages.

Take a look at our other Spanish mortgage examples here: