The questions many non Spanish citizens ask is can I get a Spanish mortgage for non residents.
Whilst foreigners buying in Spain and applying for a mortgage for overseas property can expect up to 70% loan to value, criteria for non EU citizens and Spanish mortgages for expats can be affected by where the applicant resides and is a tax resident.
In general where granted the rates for a Spanish mortgage for expats will stay the same no matter where you reside, access to borrowing and loan to values along with the term of the loan can however be affected.
Guidance as to how your country of residency may affect a mortgage for overseas property is advisable to take, before any property commitment is made.
To assist in understanding average repayment costs you can use the IMS mortgages in Spain for non resident calculator.
Spanish Mortgages for European Residents
Applicants living in most European countries who want a mortgage in Spain for non residents can expect to gain up to the normal 70% loan to value.
Whilst this can be affected by the fiscal situation of the applicant and whether they hold investment property in their country of residency the Spanish Banks offer maximum term for the Spanish mortgage for expats and those residing their own country even when the Country sits outside the EU.
This means that for instance Swiss, clients or in the future UK clients requiring a Spanish mortgage for expats, after Brexit, should experience the same treatment as those in the EU. This may change depending on the type of Brexit as one big driver on offering maximum loan to values is the ability of the Spa wish Banks to take redress against assets in the country of the applicants origin.
Spanish Banks see residents from the key areas within the EU as strong applicants. The Back books tell them that Spanish Mortgage holders from Germany, Scandinavian countries in particular, Sweden, Denmark and Norway and France are robust. The fiscal strength of these countries and stability along with clear paperwork helps the Banks ascertain the strength of the application all play a factor in the lenders desire to lend.
Some Banks in Spain will even offer preferential rates to those from Germany and Scandinavia because of the historic positive experiences they have.
Some European countries where they are considered fiscal paradises by the lenders like Gibraltar, Malta, Monaco may find lending facilities for a mortgage of overseas property are more limited due mainly to compliance issues or lack of official documentation.
Another factor that can affect criteria is the links by way of law, so whether the Bank has the facility to pursue assets in the country of the mortgagee residency in the event of a of mortgage in Spain for non residents.
Mortgages in Spain for US Citizens
Can I get a Mortgage in Spain?
Whilst applicants who are US citizens requiring a Spanish mortgage for non residents fall outside the scope of the Spanish Banks being able to realistically pursue assets in the event of a default, because the official documentation is robust and very clear and concise US citizens applying for a mortgage for overseas property in Spain can in general expect with most lenders to be treated in the same way as Europeans.
Credit files and tax returns along with plain English work contract and yearly accounts for self employed, allow the lenders to assess the risk for the mortgage in Spain for non residents in a manner by which they are used to and understand.
US citizens are also not seen as compliance issue with source of deposits and incomes easy to check under money laundering rules.
Whilst it may be difficult to obtain the Banks the full 70% something between 60% to 65% subject to status is very possible with certain clients with a high quality fiscal situation being able to obtain the full 70%.
The outcome of these restrictions is that most applicants taking a Spanish mortgage for expats will need between 35% to 40% cash input plus a further 12% or so for costs.
To work out payments each month our Spanish mortgage calculator can be used.
Australian and New Zealanders
As with US citizens applicants borrowers from both these countries will find most Banks in Spain will be willing to lend and between 60% to 65% loan to value is the normal range for a mortgage for overseas property in Spain.
Middle East and UAE expats and residents
Spanish mortgages for Expats living and working in non tax paying jurisdictions like the UAE are able to obtain loans in Spain but there are far more limitations than for other countries.
This is due to the ability of the individual to able to prove incomes due to the lack of tax returns being available.
Those employed by large multi national companies will find it easier to gain a mortgage in Spain for non residents than those self employed or employed by smaller companies but never the less between 50% to 60% is the expected range for those living and working in the Middle East.
Of recent the documentation that can be presented has improved as most Middle East countries now do have some form of credit file which is a key underwriting tool, helping you obtain a Spanish mortgage for non residents in Spain.
Spanish expat mortgage applicants can expect to have to provide many more months of bank statements to substantiate income levels and this can be up to 2 years to prove continuity of incomes.
Hong Kong and Singapore Spanish mortgage applicants
Can I get a mortgage in Spain?
Spanish Mortgages for Expats living in Hong Kong and Singapore will be able to get lending. Much of the documentation required reflects very closely the format that can be seen in Europe.
Nationals with no previous link to Europe may find lending harder to achieve.
Again like those in the Middle East loan to values are unlikely to exceed 60%.
Getting expert advice to help get a mortgage in Spain can be advisable and increase the chance of success.
Debt to income ratios reflect what is required for all non resident mortgage applications. This in general is that your outgoings on debt payments including the new Spanish loan do not exceed 35% of net incomes. For a general check on whether you can get a mortgage in Spain you can use our mortgage in Spain non resident calculator.
China, Russia, India and Africa loan applicants in Spain
Applicants from all these countries may find it difficult to gain a mortgage in Spain although it is by no means impossible.
Expats working for multi nationals in the Oil and Gas industry will be able to get some form of lending but often due to them working on fixed term contracts rather than permanent ones loan to values can be limited.
The key issue for Russian and Chinese residents usually falls around compliance and the difficulties in moving money, opening bank accounts and meeting money laundering regulations.
Due to the high level of due diligence the Banks in Spain are obligated to make some lenders choose not to deal with applications from some countries and some residents.
Generally speaking except in special circumstances 50% loan to value will be maximum. However if the applicant is employed by a well known company there are possibilities that this could be higher.
Spanish nationals working outside Spain
Whether a resident or a non resident mortgage is granted depends entirely on where taxes are being paid or the loan applicant is living.
This means that Spanish passport holders working elsewhere in the world will be offered non resident terms and conditions rather than resident ones.
Whilst because of the clear link to Spain most will not experience difficulties in gaining a 70% loan wherever they currently work and live getting the 80% they would be able to achieve if they paid taxes in Spain will not be possible.