Most of the time when buying a property in Barcelona you will need to get a mortgage in order to have your expenses covered.

Mortgages in Spain are offered by banks and “caixas”, which are comparable to building societies. You can obtain a mortgage directly from the bank or caixa, or from a mortgage broker. You can find both fixed rate and variable rate mortgages, with rates differing from bank to bank, and even between branches in the same bank, so it is worth shopping around.

It is also quite hard to finance a  property for the full 100%. In Spain banks only provide mortgages up to 70% or 80% of value of the pledge.

Traditionally in Spain banks provide 30-year mortgages, but nowadays there are also mortgage providers who provide mortgages with durations longer or shorter than 30 years.

 

What are the terms set by mortgage providers in Spain?

  • At most 35% of the net income can be used for interest and repayment
  • At most 70-80% of the value of the pledge can be provided as mortgage
  • The duration of the mortgage is at most 30 years (40 years in some cases)
  • The maximum age for people provided a mortgage is 80 years.

 

What do you need to have to get a Mortgage in Spain?

You need:

  • a copy of your passport
  • a copy of you NIE (click here to learn how to get one)
  • 3 recent payrolls or the tax declarations of the previous two years (when being an entrepreneur)
  • in case you have other ways of income, a proof of it.

 

How is the Interest rate calculated?

The interest rate that will be charged is the actual rate of the Euribor ( the interest rate of the Spanish National Bank) + a percentage for the bank providing the mortgage. The sum of these two rates is called the TAE. Moreover, the interest rate is only partly deductible.

 

Which insurances to I need to have in order to get an mortgage?

In most cases having a term life insurance and a home insurance is sufficient.  Many banks and caixas will give you a good deal on a mortgage, but insist you obtain insurance with them, so shop around for the best deal.

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