Guide to buying a property in Spain

Buying a Property in Spain

It is not as scary buying in Spain as it used to be, estate agents have to ensure information is correct, but your lawyer will also double check information. You would not buy a property in the UK without a lawyer so apply the same principle over here.

The Loan

Loans offered vary greatly in Spain although most Spanish lenders will offer up to 70% of the property valuation to non-resident applicants.

Some lenders offer an interest only option from 1 to 30 years; this will depend on the age, income, and credit strength of each client.

Information and Documentation Required

The information and criteria required varies from lender to lender but usually we will need the following:

Passport copy for all applicants
NIE numbers
UK Home address and contact details
Marital status, number, and age of dependants
Employer company name, address, and contact name and phone number to verify
Time in that employment
Income proof: Employed P60 and last 3 payslips

Self employed- 2 years certified accounts
Bank statements for last 3 months showing net salary paid in ( the Spanish lender may also request a bank reference directly)
UK experian credit report

Purchase Costs

Buyers should allow up to approximately 14% for all costs when obtaining finance for the purchase:
(your only upfront cost after deposit is normally the valuation fee which is usually approx 0.1% of the property valuation.)

Costs breakdown:

IIVA -7% of registered purchase price
Lawyer -1% of purchase price plus IVA
Broker fee -1% of loan amount
Bank opening commission usually -1%-1.5% of loan amount depending on lender
Mortgage tax (this is 1% of the loan amount and the interest over the full term ), which is typically around 1.7% of loan amount
Notary and Gestoria fees for purchase deeds and mortgage deeds registration- typically 2000 euros
Building insurance typically 400 euros

Information supplied by Smart Finance www.smartinspain.com