What you need to know to buy a Property in Spain

Introduction for foreigners

If you are a foreigner looking for a property for sale in Spain here are some things you might be interested in knowing. Buying cheap property in Spain is not as easy as it used to be. The Spanish property market is at a peak although Spanish mortgages are available for the residents of the United Kingdom or any foreign residents who wish to acquire a property in Spain.In most cases you can get a mortgage up to 80% the value of the property, possibly more in special circumstances. Spain property mortgages are available in all of the most important banks of Spain, the United Kingdom and the moneylenders of Gibraltar. In addition, many new Spain properties for sale under construction on the Costa del Sol (and inner parts of Spain) are already mortgaged by the builder to obtain capital ahead of the construction.

New Properties in Spain

A buyer, under the direction of a Spanish lawyer, can acquire such mortgage when buying a new construction property in Spain. In this case, the mortgage can reach the value of 80%. In some cases the properties are offered for sale already with a mortgage. Your lawyer must control the terms and conditions that are applied to the mortgage and advising you according to them. In Spain the mortgages are attached to the property and are written within the property title, therefore it is very important to be advised by a Spanish lawyer who is familiarized with this, since the mortgage is on the property and not on the person who acquires the mortgage.

Loan Rates

Unless you are buying a spanish property already with a mortgage, the cost to transact a mortgage will be approximately from 1% to the 1,5% of the advance amount. As a guide, a nonresident can borrow approximately 60% from the value of the property. If you obtain a loan in a currency that does not have a fixed value against euro, for example the sterling one, the fluctuation of the currency can cause that your loan to be more or less expensive depending on the exchange rate. The interest rates also will depend on the currency in which you choose to obtain the loan. The interest rates for spain mortgages in euros are based on the EURIBOR, the rate of the moneylenders will be a little superior to the Euribor, generally Euribor + 1,25%, but certain moneylenders can fluctuate. The mortgages on a rate fix are available to slightly superior indices of interest. For more information on EURIBOR, see http://www.euribor.org. Generally the rates are reviewed once a year.

Loan Reimbursment

The cost of an advance reimbursement of a mortgage in Spain is from zero to 1%, depending on the type of loan. Some moneylenders only receive cancellations in the first five years, others do not receive anything. It is important to choose your moneylender carefully if you try to reimburse your loan early.

Spanish Loan Paperwork

The banks vary in the amount of information that they ask for loan attainment. In general form, you can expect that they request the following:
Last the 3 receipts of pay wage.

The last declaration of Taxes, or demonstrates of the last annual declaration of taxes.

Copies of your present statements of account that include last the 6 months.

Letter of reference of your employer confirming the date of use and the test of income (not always essential but useful, especially if you want a large loan).

Copy of passport

If you are an independent worker:

The last declaration of taxes by income.

Copies of the accounts of last the two or three years.

Report of a Company of Accountants Public, confirming your annual personal movements from the company.

Personal account statement.

Letter of reference of a bank.

Copy of passport.

That's all for now, check back soon as I will be adding more information about buying a property in Spain.