A mortgage in Spain is similar to a mortgage in the Netherlands, but there are some important differences:

1. Loan-to-Value: Spanish banks usually finance 70% of the purchase price or appraisal value, which is lower than the 100% financing that is sometimes possible in the Netherlands. For non-residents, this percentage is usually lower than for Spanish residents.
2. Down payment: In most cases, you will have to pay a portion of the purchase price as a down payment yourself, as well as additional costs such as taxes and notary fees – known in the Netherlands as ‘costs buyer’. However, the exact down payment depends on the type of property. For existing construction, this is usually 10%, while for new construction projects the down payment can increase to 30-40% during the construction period.
3. Interest rates: The interest rate can vary between fixed and variable rates. Variable mortgages are often linked to the Euribor interest rate.
4. Term: Mortgages in Spain for non-residents usually have a maximum term of 20-25 years, depending on your age and income.

Suppose you have found your dream house with a purchase price of €500,000. How much you can borrow and how much of your own money you need depends on the type of house:

For existing construction, the mortgage is based on the appraisal value, which is sometimes lower than the purchase price. Suppose the home is appraised at €450,000. As a non-resident, you can borrow a maximum of 70% of the appraisal value, which amounts to €315,000. This means that you have to put up €185,000 yourself.
In addition, the buyer’s costs (k.k.) are added, which amount to approximately 10.6% for existing construction. This includes:

• Transfer tax: 7% (€35,000)
• Notary fees: 0.6% (€3,000)
• Legal purchase assistance + financing application: 3% (€15,000)

  Total additional costs: €53,000

In new construction, the purchase price is often equal to the appraisal value. This means that you can borrow 70% of €500,000, which amounts to €350,000. You must then contribute €150,000 yourself. The buyer’s costs (k.k.) for new construction are higher and amount to approximately 14.8%, consisting of:

• VAT (IVA): 10% (€50,000)
• Registration costs property register: 1.2% (€6,000)
• Notary costs: 0.6% (€3,000)
• Legal purchase support + financing application: 3% (€15,000)

  Total additional costs: €74,000

Total own contribution: €185,000 + €53,000 = €238,000

Total own contribution: €150,000 + €74,000 = €224,000

For new construction, the own contribution is often slightly lower than for existing construction, but the additional costs are higher. This is important to include in your financial planning.

In addition to the down payment and notary fees, there are additional costs associated with taking out a mortgage, the well-known ‘buyer’s costs’. On average, these costs are 14.8% of the purchase price of new-build homes and 10.6% for existing construction. Below we provide an overview of the most important expenses:

• Transfer tax: In Andalusia you pay 7% transfer tax on the purchase value of existing construction. For new-build homes, this rate is 10%.
• 1.2% new-build registration 1st owner.
• 0.6% notary fees & land registry registration.
• 3% service fee, this includes purchase guidance, lawyer, valuation, financing application and authorisation. This percentage is 2% if no mortgage application is necessary in Spain.
• Insurance: Taking out life insurance and/or home insurance is often mandatory.

  We ensure that all costs are clearly presented, so that you are not faced with any surprises.

Even if you are not a resident of Spain, you can take out a mortgage with Spanish banks. However, specific conditions often apply to non-residents. Please note:

• Stricter requirements: banks often ask for more financial documents from non-residents.
• Lower financing: as mentioned earlier, you can usually borrow a maximum of 60-70% of the value of the property. For a second mortgage, this is a maximum of 50%.
• Additional guarantees: some banks ask for a surety or additional guarantees.
• The maximum term of a Spanish mortgage for non-residents is 25 years. In addition, the mortgage must be fully repaid before you reach the age of 75.

  At Turnkey del Sol, we have experience in assisting non-residents with their mortgage application. Schedule a free digital introductory meeting.

At Turnkey del Sol we understand that arranging a mortgage in Spain can be complex, especially if you are not familiar with the language and local regulations. Although we do not provide mortgage advice, we can fully relieve you of the burden of applying for financing. This means:

• Collecting documents: We help you collect and submit all required documents to the bank.
• Communicating with the bank: We maintain contact with banks and ensure that your application runs smoothly.
• Guidance from A to Z: From the first steps of the application to signing at the notary, we are at your side.

  By authorising us to arrange your mortgage application, you save time and energy, while you know for sure that everything is handled correctly. For substantive mortgage advice, we refer you to a specialised financial advisor. See below what our purchase guidance, including the legal service, looks like:

Buying a property in Spain, including arranging a mortgage, can be easy with the right help. At Turnkey del Sol, we ensure that your mortgage application goes smoothly. Want to know more about what you could borrow or get started right away? Contact us and let us guide you through every step of the process.