How to get a mortgage in Spain
If you require a mortgage against the property in Spain, you should contact your estate agent or local bank as soon as possible. A mortgage can be applied for in Spain or abroad. If you have not arranged a mortgage, we may be able to help you, through an offshore or Spanish bank. If you are making your own arrangements you will need to advise your estate agent of the date by which you expect to have the funds available in order to complete the purchase. A non-resident purchaser in Spain may apply and obtain a mortgage of up to approximately 70% of the bank’s valuation of the property. A resident or national purchaser may obtain up to 100% of the valuation (when purchasing repossessed stock from a bank). Under such circumstances the property purchased in Spain would act as guarantee for the mortgage. Both variable and fixed rate mortgages are currently available.
Interest rates on mortgages in Spain are nearly always based on the Euribor. Spanish banks are currently offering rates of between 1% – 1.5% + Euribor. During 2012, the Euribor has come down from 1.837% in January to 0.542% in December (2012), currently the lowest rate ever (see below for latest rates). Other factors to discuss and negotiate with a bank are those of interest only during a stipulated number of years or a combination of interest and capital repayments, and of course the total period of the loan.
(Images reproduced from SPANISH PROPERTY INSIGHT.)
During 2013 the Euribor average was 0.57% – Historically, the lowest average level in the Euro zone.
During 2014 the Euribor average was 0.473% – Beating the previous year’s low.
January (2015) ended at 0.298%.
February (2015) ended at 0.255%.
March (2015) ended at 0.21%.
April (2015) ended at 0.18%.
May (2015) ended at 0.16%.
June (2015) ended at 0.16%.
July (2015) ended at 0.166%.
August (2015) ended at 0.161%.
September (2015) ended at 0.154%.
October (2015) ended at 0.13%.
November (2015) ended at 0.082%.
December (2015) ended at 0.059%.
During 2015 the Euribor average was 0.168%
January (2016) ended at 0.042%.
February (2016) ended at -0.008% – the first negative rate in the history of the Euribor.
March (2016) ended at -0.012%.
April (2016) ended at -0.01%.
May (2016) ended at -0.013%.
June (2016) ended at -0.028%.
July (2016) ended at -0.056%.
August (2016) ended at -0.048%.
September (2016) ended at -0.057%.
October (2016) ended at -0.069%.
November (2016) ended at -0.074%.
December (2016) ended at -0.08%.
During 2016 the Euribor average was -0.082%
January (2017) ended at -0.095%.
February (2017) ended at -0.106%.
March (2017) ended at -0.11%.
April (2017) ended at -0.12%.
May (2017) ended at -0.127%.
June (2017) ended at -0.149%.
July (2017) ended at -0.154%.
August (2017) ended at -0.156%.
September (2017) ended at -0.168%.
October (2017) ended at -0.18%.
November (2017) ended at -0.189%.
December (2017) ended at -0.190%.
During 2017 the Euribor average was -0.114%
(Source: Bank of Spain)
Finding the right bank
Despite much publicity surrounding the banking system in Spain during recent years, mortgages are freely available but are subject to more stringent conditions of approval. Also, certain banks in Spain tend to specialise in mortgage applications from foreign buyers, such as Banco Santander Central Hispano, Banco Sabadell Solbank, La Caixa and BBVA (Banco Bilbao Vizcaya Argentaria). To get a local feel, ask an estate agent in the area of your property acquisition, they normally know the local banks that will be able to assist you.
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