A Guide To Mortgages In Spain

Independence is a crucial factor to our success and we can offer you a totally independent mortgage service to suit your requirements direct from high street Spanish banks. Below are some frequently asked questions about mortgages in Spain.

How Much Can I Borrow?

Lending in Spain is based on the valuation of the property; we can obtain 70% mortgages for our clients depending on circumstances reasonably easily.

What Types Of Mortgages Are There?

Almost all mortgages are capital repayment and some include an interest only term. Fixed rates do exist but the interest rates are expensive.

What Is The Interest Rate?

The interest rate in Spain is called EURIBOR. This is based on the European Central Bank base rate and changes every month. 3.20% is a good indicator of the rate available to non residents although it has never been this high. With the base rate in the UK currently 4.75% your repayments are more affordable.

How Do I Repay The Mortgage?

We can refer you to a commercial exchange company who can arrange a fixed rate for monthly repayments so the sterling you pay for your mortgage remains the same regardless of exchange rate fluctuation.

What Documents Do I Need?

Employed

• 1. Passport
• 2. P60
• 3. Last 3 months payslips
• 4. Last 3 months bank statements
• 5. Bank reference *
• 6. Employers reference *
• 7. Credit report *
• 8. Credit report *

Self Employed

• 1. Passport
• 2. Tax Return
• 3. Profit & Loss accounts for return
• 4. Balance sheet to date
• 5. Last 3 months personal & business bank statements
• 6. Bank reference *
• 7. Accountants reference *

* depending on lenders criteria

How Long Does It Take To Complete?

From deciding on the property you want and paying the reservation deposit to completion is usually 6 weeks if you need a mortgage. Without a mortgage it is usually 4 weeks. This extra time is needed to receive your income documents and to instruct and obtain the valuation.

How Much Is It Going To Cost Me?

In general terms if you are purchasing without a mortgage you will need to pay 10% of the purchase price in taxed charges and fees. If you are buying with a mortgage you will need to pay up to 13%. The fees are listed below:

Purchase Costs

• 7% IVA (VAT)
• 1% Stamp duty
• 1% Legal fees (there may be a minimum to pay)
• Notary fees

Mortgage Costs

• 1% - 1.5% Set-up fee
• 1% Stamp duty (1% of mortgage value + 1% of total accrued interest)
• Valuation fee
• Notary fee
• Arrangement fee

Do I Need A Spanish Lawyer?

Getting an English speaking Spanish lawyer is of paramount importance. The lawyer will check to make sure the property is legal, the debts, if any, registered to the property are being cleared from the sale proceeds. They also controls the flow of money through client accounts, organizes the connection of services, and if they have power of attorney can sign at the notary to complete on your behalf. If you would like us to recommend an independent English speaking Spanish lawyer we would be happy to oblige.

Currency Exchange

For currency exchange Belmonte International recommends SGM-Foreign Exchange Ltd.

SGM-FX is the market leader in the provision of commercial foreign exchange services. And are able to give you the exchange rates normally only available to large companies.

SGM-FX pride themselves on offering our clients much more than simply saving money on their foreign exchange transactions, and understand when purchasing overseas property that it is vitally important for a purchaser to understand and feel comfortable with every stage and aspect of the process.

• No Commission Fee
• Free Transfer on transactions over £20,000
• Better Exchange Rates enabling large savings
• SGM-FX use the volume of their transactions to obtain wholesale rates from the currency markets and pass these savings onto you
• Specialist Dealers
• Who will understand your needs and explain your options to you in plain English
• Range of Services
• Whether you need your foreign currency in 18 hours or 12 months, SGM-FX have a wide range of foreign currency instruments to meet your needs
• Going the Extra Mile
• To add further value they have established professional relationships with organisations and individuals around the World
• Commitment to Excellence

SGM-FX is dedicated to providing our clients not only with a currency service, unlike the banks, but also to providing a service which exceeds all expectations and develops long terms relationships with clients.

Call them now (or ask us to get SGM-FX to contact you) to speak to one of their foreign exchange specialists and find out how SGM-FX can make your next currency transaction simple, cost-effective and worry free.

How does it work?

Step One - Register with SGM-FX

SGM-FX will provide you with the registration documents and once you have returned them they will contact you to inform you that your registration is complete and your trading facility is set up. There is no cost and no obligation when registering.

Step Two - Get a great rate

As soon as your registration has been confirmed you will be able to place an order and buy your currency. The specialist dealers will get you the best rate they can at the time you call. If you like the rate they offer, all you do is accept the rate on the phone and that is the deal done! They will send a confirmation of purchase via email, fax or post. If you think the rate may improve you can ask the specialists to contact you as soon as the market improves.

Step Three - Your money is transferred

As soon as a rate is agreed, depending on the type of transaction you do, you will need to instruct your bank to transfer the funds (that you have sold) to SGM-FX's client account. Upon receiving your funds they will be ready to make your currency payment to the bank account that you have specified.

UK Head Office

Prince Rupert House Tel: 020 7778 0123

64 Queen Street Fax: 020 7248 7477

London From outside UK

EC4R 1AD Tel: +44 (0) 20 7778 0123

England Fax: +44 (0) 20 7248 7477