If
you're planning to buy a home of your own in Spain, International
Mortgages have a local team of specialists, who can provide you with
all the help and advice you will need.
We have years of experience in assisting people to purchase properties
in the Iberian Peninsular - and we are in regular contact with surveyors
and lawyers in most of the expatriate centres. So we are ideally placed
to guide you through the whole process - and ensure that your purchase
is completed as speedily and smoothly as possible.
However, don't wait until you've found a suitable property. Talk to
us as soon as you can - ideally before you even start looking for
a home. We can explain the whole procedure to you, warn you about
some of the pitfalls, establish exactly how much you can borrow -
and generally smooth the way to your new front door.
Includes Spanish Residential Property in Mainland Spain, Canaries
& Balearics.
Loans available for the majority of Nationalities for either House
Purchase or refinancing for Home
Improvements only. |
|
Type
of loan
|
Repayment,
Endowment and ISA Mortgages |
|
minimum
|
£10,000 |
|
maximum
|
no
maximum, but must not exceed 75% of valuation or purchase price (whichever
is the lower). |
|
Proof
of income
|
required
in all cases
(can be made up of earned income, pension, investment
or rental income. Please note however, that it is not always the case
that the lender will take all or part of these incomes into account
when determining the maximum loan available).
Non-status loans are currently not available. |
|
Term
|
5
to 25 years up to age 70 |
|
Currency
|
All
major currencies - including Euros. |
|
Current
interest rate
|
from
approx. 1.50% above LIBOR on a Variable Rate basis in Sterling, or
3.95% fixed for 6 months in Pasetas. |
Example:
Repayment mortgage of £50,000
over a period of 15 years at an interest rate of approx.
7.50% = £472.50 capital & interest per month = a total approximate
amount payable over the term of £87,050 including capital, interest
arrangement and survey fees.
|
| How
much can I borrow? |
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to top |
Your
loan is based on your joint net "take home" pay and is calculated
on an affordability basis. All your existing liabilities including
any mortgage/rent payments, personal and bank loans and any maintenance
payments together with your proposed Spanish mortgage payments must
not exceed 35% of your net monthly income.
Example:
Net joint monthly income £2,500 x 35% of that
figure is £875 minus existing monthly mortgage payment £300
- no other liabilities. This leaves a balance of £575 for a
proposed Spanish Mortgage payment.
|
| Guidance
notes for purchasing a property in Spain |
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to top |
Please
ensure that you will have full title to the property on completion
and that the "nota simple"
is available for the lender this document may be required before a
valuation can be carried out.
With
new properties, find out the date the property will be registered
in your name(s), as the lender cannot lend on the security of the
property until it has been registered.
Whilst all reasonable steps will be taken to secure the loan on your
overseas property as soon as possible, delays may occur due to the
Spanish legal and administration system.
Check with the estate agent/vendor that you are aware of the costs
charged by the legal & government authorities for purchasing a
Spanish property, noting that the lender will have their own legal
costs for assigning the loan (the cost of which they will normally
advise when they issue the mortgage offer).
It is essential that you take the appropriate independent legal advice
if purchasing a new property as would be expected if you were purchasing
in the UK.
The completion of a Spanish mortgage takes place in front of an appointed
Spanish notary and all parties to the mortgage, including the vendor,
lawyers and a representative of the lender need to be present. However
a power of attorney may be used to sign on your behalf for the mortgage
and deeds. A copy of this power of attorney will need to be presented
to the lender in good time before completion.
A Spanish bank account will be required and some lenders offer this
as part of their service, but not
all.
It is advisable to arrange your mortgage finance before agreeing to
purchase a property. You should never sign anything or make a deposit
without ensuring your deposit is refundable and you have taken independent
advice.
All Spanish mortgages are "full status" and proof of income
for a minimum of two years is required. Some lender's carry out UK
credit checks but not all.
Your home is at risk if you do not keep up repayments on a mortgage
or other loan secured on it. Be sure you can afford the repayments
before entering into any credit agreement.
The local currency equivalent of your liability under a foreign currency
mortgage may be increased be exchange rate movements.
All figures believed correct at time of issue.
This is not an offer of mortgage
|
| A
guide to lawyers' fees
|
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to top |
As
the purchaser, you will be responsible for our legal fees, as well
as your own. In addition, you will be required to pay the relevant
taxes, land registry charges and the Notary's fees.
We will appoint a lawyer from our approved panel to act on our behalf.
If you also wish to use a lawyer from our panel, please ask us for
further details on the contacts
page.
An indication of the legal fees is set out below; in your own interests,
you should obtain an estimate from your lawyer, in advance. We will
provide you with an indication of the taxes, land registry fees and
the Notary's fees, upon request.
1. For the purchase
1% of the purchase price, subject to a minimum fee of £1,500.
2. Stage payments
If the mortgage is being arranged on a staged payment basis, the scale
of fees will be as set out above, plus:-
• If there are to be two stage payments: £125*
• If there are to be three stage payments: £250*
3. Subsequent increase in mortgage
Subject to our normal lending criteria, you may increase your mortgage
at some future date, to help with home improvements or other purposes.
The minimum increase is £10,000 - and the legal fees are likely
to be:- |
|
Amount
of Loan
|
Fee
|
|
£10,001
to £25,000
£25,000 or more
|
£250*
1% of the amount borrowed *
|
4.
Paying your mortgage early
If you pay off your mortgage before the end of the end of the original
term, you will incur the following fees:- |
|
Legal
fees
|
Administration
fee
|
Other
fees
|
|
£150*
|
£200
|
Land
registry, Notary, local taxes *
|
| During
the first two years, an early redemption charge of up to 3 months
interest will be payable. |
| Offshore
Companies
|
For
tax planning purposes, you may prefer to purchase your new home in
the name of an offshore company. If so, you must provide us with a
personal guarantee for the amount of the mortgage. The advantages
and disadvantages of buying your home in this way will depend upon
a number of factors - and we recommend that you discuss the matter
with us, or with your lawyers at an early stage.
If you wish, we can arrange for the formation of an offshore company
by one of the leading firms of company formation specialists, with
which we have negotiated special terms for our customers. Details
of the costs involved are set out below:
• Formation of a new offshore company in Gibraltar: approx £810
• Annual maintenance fee (year 2 onwards): approx £700
• Transfer of an existing offshore company: approx £700
If an offshore company already owns the property or you have already
formed such a company, its management must be transferred to a firm
nominated by us.
* Plus IVA (VAT)
and disbursements |
|
