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Contact:

Inmobiliaria Porto Petro

Kirsten Ekmekci
Apartado de correo 234
ES-07660 Cala dor

Tel: 0034-666145777
Email: info@mallorca-southeast.co.uk

Spanish Mortgage

Mortgages in Spain and majorca

All Spanish banks provide mortgages and are quite happy to do so. It pays to shop around for a mortgage as interest rates and terms vary considerably depending on the bank, the amount and the period of time. You can, of course get a mortgage from a UK Bank or Building Society but it is easier and quicker to use a Spanish source and or a Mortgage Broker. 

Mortgages Fees

The fee for the valuation is approximately 275 euros but obviously varies according to the size of the property. A search must also be made in the Land Register and a certificate issued for the corresponding entry to check on the possible existence of other mortgages or loans made against the property. If the home you are buying is still under construction, the builder may require the cost of the property to be paid in a series of payments. Most lenders can provide a mortgage that matches these requirements subject to certain safeguards.


Financial institutions will offer you a choice of repayment plans which usually include:


Endowment Mortgage - whereby every month or quarter you make two separate payments, one for the interest on the loan, the other for the premium on the endowment policy. Capital Repayment Mortgage - whereby you make either monthly or quarterly payments of interest and capital on the mortgage. During the early years, each monthly payment comprises mainly of interest. In later years, more of the capital is paid off. You will generally be given a period of up to 20 years to repay your mortgage and it is your responsibility to ensure that you have a suitable mortgage protection policy to repay the loan if you die before the end of the mortgage term (often a bank will require you to take out a mortgage protection policy). In general, you can expect to pay approximately 10 percent of the property purchase price in associated taxes and fees.


Mortgage Details from The Banca March Residents or Spanish buying their 1st home
Up to 80% of the taxation value of the property
Interest rate: Euribor + 2% min. 4,5% in total
Opening Commission: 1,25%

Residents or Spanish buying a second home
Up to 60% of the price of the property
Interest rate: Euribor + 2% min. 4,5% in total
Opening Commission: 1,25%


Non-Residents who want to buy a second home

Up to 60% of the price of the property
Interest rate: Euribor + 2% min. 4,5% in total
Opening Commission: 1,25%


Necessary items for a mortgage request

Employees
1. Last 3 payslips
2. Last tax declaration (P60 if from the UK)
3. Filled out application forms
4. Photocopy of Passport
5. Copy of Titledeed from Property Register (Nota simple)



Selfemployed

1. Tax returns last two years
2. VAT and income tax returns
3. Balance sheets
4. Last 3 bank statements
5. Filled out application forms
6. Photocopy of Passport
7. Copy of Titledeed from Property Register (Nota simple)

How to finance your dream home in majorca ?

At present there are many Banks and Financial Institutions throughout Europe, including the normal Spanish Banks, lending money for Residential and Commercial property purchase in Spain. All lenders will secure the loan on a property, either in your own country or on the Spanish property itself. Spanish banks and U.K. lenders arranging mortgages on Spanish property will lend a maximum of 60% of the purchase price to non-residents. Interest rates starting as low as 4.5% and Interest Only Mortgages and Capital and Interest Mortgages are available. Full quotations on request through Banca march.


There are both advantages and disadvantages to arranging a mortgage in Spain instead of the U.K. With a Spanish mortgage you will incur higher set up charges compared to the U.K. and many of the current mortgage schemes that U.K. lenders enjoy are not yet available. Some of the advantages Spanish lenders have over their U.K. counterparts are lower interest rates and flexible lending criteria that are designed for quicker application and completion times. You will also find only a handful of U.K. lenders arranging mortgages directly on Spanish property in comparison to the Spanish Banking industry as a whole.