Long before deciding to buy that Spanish property, or even better, before you start searching for property in Spain you should start looking into Spanish mortgages. Here is some helpful information on Spanish mortgage fees and Spanish mortgage brokers.
Spanish Mortgage Brokers
The best possible mortgage is one that fits your personal requirements, has the most flexibility and the lowest cost throughout the mortgage lifetime. Spain has an enormous selection of possible mortgages and finding the one that fits you best takes time. This is why you ideally start looking into mortgages around the same time you start looking for property in Spain. Find a mortgage broker who can define your personal needs and is specialised in Spanish mortgages. He or she should then evaluate your creditworthiness to figure out how much debt you can handle to find the most suitable mortgage product.
The Spanish mortgage brokers work together with mortgage lenders and have a good idea of what is being offered but can also tell you the exact hidden fees you might not realise exist. You can also benefit from their knowledge of bank offers and deals and term negotiation skills. In terms of lenders the mortgage brokers can often take advantage of their own reputation to get the best deal for their clients. In turn, lenders benefit in many ways from mortgage brokers who act as mediators between them and the client which creates a win-win situation for all.
In Spain there are several mortgage-related fees you need to take into consideration, such as...
- Mortgage Valuation: Fee for valuing the property by a specialised valuation company that can range between a few hundred to more than 1000 €. The cost depends on the value of the real estate.
- Mortgage Opening Fee: A fixed fee, typically 1% of the mortgage value.
- Mortgage Insurance Fee: Three types of insurance exist in Spain. General house and contents insurance, life insurance and mortgage insurance. The first is legally required and the amount is determined upon valuation. The insurance value is the same as the amount to rebuild the property, excluding the plot value. The latter two are optional.
- Land Registry Fee: Also called a Nota Simple, is meant to exclude any debts attached to the property. You will need to request this document either yourself or through your lawyer and the fee will need to be paid in any case.
- Stamp Duty AJD fee: A government tax fee of which the amount to be paid depends on the region.
Should I get a Spanish Mortgage Broker?
It depends. For most overseas clients a Spanish mortgage broker is the best option but of course this costs money. You need to decide whether the mortgage broker is worth his fees as not all brokers are equally knowledgeable, helpful and professional. There are some Irish and British brokers who claim to be specialist brokers in Spain but watch out; if all your broker does for you is push high commission mortgages and introduce you to a bank you are probably better off doing your own mortgage research. After looking into Spanish mortgages you can contact lenders directly and get quotes from a selection of these. This way you save the mortgage broker fee of 0.5 to 1% or more of the mortgage value.
For a complete guide to mortgages in Spain visit....