Looking for a Spanish Mortgage

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This topic contains 29 replies, has 10 voices, and was last updated by Profile photo of Inez Inez 9 years, 3 months ago.

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  • #53042
    Profile photo of Anonymous
    Anonymous
    Participant

    We are looking for a mortgage on a property in Costa Almeria. We already have an in principle agreement with Barclays at Euribor +1.5% (less fees as my wife is staff) which we have been told is a lot. During our trip last week, we were told that we could see a mortgage advisor (obviously not independent but it would have been a start) but we never did. We have managed to get a hold of the advisor to be told the fee is €650 which seems an awful lot compared to the UK where the advisor either gets a “kickback” from the bank/ building society or fees are about £300. We also need to ask them whether it is afee for just looking or payable on arrangement/ completion.

    Does anyone have any recommendations please? (PM replies if inappropriate)

    Thanks

    Mark

  • #73698
    Profile photo of katy
    katy
    Spectator

    Recommend you don’t use a broker at all. In Spain they take your (substantial) fee and the kick-back from the banks, also you still may not get the best mortgage for you.

  • #73701
    Profile photo of Anonymous
    Anonymous
    Participant

    Hmmm interesting. Our solicitor is also looking at mortgages for us. Is there any particular bank that is better than the rest or offering a more competitive deal?

    Thanks

    Mark

  • #73707
    Profile photo of Anonymous
    Anonymous
    Participant

    A mortgage brokers takes a fee from the applicant and a commission from the respective Bank. In UK as well as in Spain. The broker in theory has to get the best deal for you in practise this does not happen neither in UK or Spain.

    In UK a broker has access to hundreds of lenders due to a very mature/competative market. Only a kneive borrower ends up paying the broker or if they have a bad credit etc and a specialised lender is required. However if you challange them the fee to the applicant is dropped without much resistence.

    If Markfish is willing to do some leg work he should check out other banks and will be pleasently surprise as to whats on offer, specially if he is willing to get an insurance, debit card etc from the bank.

    I feel that if Markfish’s wife works for a Bank, she should be aware as to what the other banks are offering. Markfish should try and subrogate the developers mortgage if he buying newbuild/offplan.

  • #73724
    Profile photo of Anonymous
    Anonymous
    Participant

    @shakeel wrote:

    If Markfish is willing to do some leg work he should check out other banks and will be pleasently surprise as to whats on offer, specially if he is willing to get an insurance, debit card etc from the bank.

    We found this out whilst at the solicitor’s. My Wife was surprised about it as this practice is illegal in the UK.

    @shakeel wrote:

    Markfish should try and subrogate the developers mortgage if he buying newbuild/offplan.

    Sorry, I don’t understand this comment. Could you explain for me please?

    Many thanks

    Mark

  • #73725
    Profile photo of Anonymous
    Anonymous
    Participant

    Markfish wrote:

    Does anyone have any recommendations please?

    Have you asked Banco Halifax for a quote? Their rate is currently Euribor +1% for a Residential purchase. They also don’t charge a fee for transfers from UK Halifax accounts and give a pretty good exchange rate.

    Plus you get full online banking facilities with them.

    Cheers,

    Jogary.

  • #73730
    Profile photo of Anonymous
    Anonymous
    Participant

    With your wife being staff, I would have thought you may have got a discounted rate from Barclays although it seems they are charging twice their current rate

    Barclayd actually offer one of the best and most competitive mortgage ranges at the moment and are offering Euribor + 0.75% as a standard product

    http://www.mortgagefornonresidents.barclays.es/

  • #73736
    Profile photo of Anonymous
    Anonymous
    Participant

    They will only give the Wife themortgage fee free, no discounts :(. The 0.75% is also only available on 70% where we want 80%. Still looks as though they will be the ones to use though.

    Mark

  • #73741
    Profile photo of Anonymous
    Anonymous
    Participant

    Markfish: Wether it is legal in UK or not. Have you not heard of taking out a mortgage in Uk and the lender insisting that you take out a life Insurance or contents etc.

    Besides you are not in UK. Its important to realise that different Country has its laws & customs and I am sure you do. While for mental stimulation its good to compare and see the merits or demerits of each. But that is where it should stand.

    Can you imagine what a Spaniard will think when he/she comes to UK and find out how expensive it is to travel, buy a beer or tobacco

  • #73750
    Profile photo of Fuengi (Andrew)
    Fuengi (Andrew)
    Participant

    @katy wrote:

    Recommend you don’t use a broker at all. In Spain they take your (substantial) fee and the kick-back from the banks, also you still may not get the best mortgage for you.

    very true.
    Go to the banks yourself or contact them. They will speak english. And the offers are getting very interesting.

  • #73753
    Profile photo of Anonymous
    Anonymous
    Participant

    Fuengi: In Uk its the same.

    The mortgage brokers charge a fee to the cilent (usually gets dropped if you say you will go to some one else ) and the the kick back that you mention is all above board as it appears on mortgage papers/ e.g offer letter which states the name of the broker and the commission they earn.
    I would not call it as kick back as this how they earn their living.

    However, the mortgage company or the product that the broker (IFA) advises you as suitable. one cannot ever be sure as only the broker knows what commission (kickback) lender is offering to the introducer.

    A good example of this in UK the endowment miss selling in the 80’s.

  • #73813
    Profile photo of Anonymous
    Anonymous
    Participant

    ING – Euribor + 0.33%
    Activobank (Solbank) Euribor + 0,22%
    Bankinter Euribor + 0,18%

  • #73815
    Profile photo of Anonymous
    Anonymous
    Participant

    Jarezgirl,
    Are the rates that you mention for intrest only mortgages ??? or repayment.

  • #73816
    Profile photo of Anonymous
    Anonymous
    Participant

    These are repayment interest rates.

    I don’t know if they offer interest only as well.

  • #73817
    Profile photo of Anonymous
    Anonymous
    Participant

    While it may not be suitable for all. But its better to have interest only mortgage specially, where ones main house is in UK.

    The advantages are

    1) Lower monthly payments, help with the cash flow.

    2) As you dont pay the capital you pay reduce “Patrimonio” tax.

    3) Lower UK inheritence tax.

    4) Flexibilty to repay capital as and when you are lucky enough to win the lottery.

  • #73818
    Profile photo of Anonymous
    Anonymous
    Participant

    What would be cheaper:

    a) an interest only mortgage at Euribor + 0.70%
    b) repayment mortgage at Euribor + 0.18%

  • #73822
    Profile photo of Anonymous
    Anonymous
    Participant

    Its quite obvious what will be cheaper.

    a) an interest only mortgage at Euribor + 0.70%
    b) repayment mortgage at Euribor + 0.18%

    Not cheaper is not always sauitable as given the reasons above. One can change from interest only to repayment as onces circumstances changes.

    It is for this reason one should not generalise

  • #73823
    Profile photo of Anonymous
    Anonymous
    Participant

    Sorry Shakeel, I’m not clear about your answer.

    On a previous post I think you said an interest only mortgage would be cheaper.

    But if there are repayment mortgages around at Euribor +0.18% as opposed to 0.70% for interest only, does this mean it is cheaper to take the repayment option?

    I am in the process of hunting around for a mortgage at the moment which is why I am interested.

    I’m thinking of going for the Activobank (Solbank) one as they will lend up to 90%. I think the others only lend 80%.

  • #73829
    Profile photo of Anonymous
    Anonymous
    Participant

    repayment mortgage at Euribor + 0.18%. is cheaper on the face of it. They might be loading on other things.

    What, I meant was that with interest only you pay less monthly as you are not paying capital. So it helps the cash flow and helps to buy all the large items that you need to set up a new home.

  • #74121
    Profile photo of Anonymous
    Anonymous
    Participant

    Hi Guys, this thread has been helpful so just wanting to say thanks!

    We are looking at buying in Asturias in a few weeks and trying to figure out is it better to get a mortgage through a Spanish Bank or a UK Broker such as Mortgages4U (which seem to be very expensive as their fee is £1000 and the rates are also high).

    We are heading to Asturias in Northern Spain in September so if anyone has any reccommendations on specific banks to target then the info would be really appreciated.

    Cheers

    Sinead and Darren

  • #74122
    Profile photo of Anonymous
    Anonymous
    Participant

    Try Banco Halifax. They may however not cover Asturias. When you are there just walk into the Banks.

    There may be local provincil banks from Asturias. In theory they should be competative but Spain being Spain this may not be the case.

    I should be careful as mortgage brokers will take your application to the lenders that provides them with a highest introduction fee. This in the short or long run will be paid by your directly/indrectly.

    Save your self the fee. A bit of leg work will get you a suitable product in the process you will learn about the mortgage market in Asturias. You can write a book about mortgages in Asturias, after you have had your Fabada and the Cidra.

  • #74123
    Profile photo of Anonymous
    Anonymous
    Participant

    Thanks Shakeel…..will make plenty of notes on our visit for that book we will attempt when we retire!!!

  • #74124
    Profile photo of Inez
    Inez
    Participant

    Whilst I agree in principle in saving yourself the fee by going direct, very few brokers are actually any good or usefull.

    The one I recommend can get deals through banks due to the sheer amount of business they do and so get special rates and in some cases, awkward files whereas for example someone asset rich and cash poor would ordinarily be turned down by every bank here in Spain, finance is granted.

    Also money can saved by not having to take the various life insurance policies insisted upon as well as interest rates reduced or negotiated in the clients favour

    Initial advice is free – yes there is a fee but only if the mortgage is approvd and then taken. But than again if the service has been successful with a client having a smooth transaction and the best product for them, then why should there not be a payment?

    Oh – and it makes a change that they know their stuff, dont promise what cannot be delivered and wont handle anything dodgy or illegal! (and yes they are based in Spain!!!!) 😀

  • #74126
    Profile photo of Anonymous
    Anonymous
    Participant

    Thanks Inez, can you PM me their contact details and I can add them to the list I will contact?

    Cheers

  • #74132
    Profile photo of Inez
    Inez
    Participant

    Done Sinead – good luck!

  • #74153
    Profile photo of Anonymous
    Anonymous
    Participant

    Hi Sinead,

    If you’re moving anywhere near LLanes (Asturias), and looking for a UK branded bank, then there’s a Barclays in town.

    In addition, Abbey (now part of Grupo Santander), will arrange a Spanish Morgage etc. through Banco Santander. For the UK, this is all run from a London office, I don’t know if they have something similar for Ireland.

    In general, upfront charges are higher (a lot) on mortgages taken out with Spanish Banks, but you benefit from a lower interest rate. Also watch out for hefty additional charges / restrictions, such as capital payments, early redemption etc.

    Regards,

  • #74154
    Profile photo of Anonymous
    Anonymous
    Participant

    And another thought …………

    try having a look at the regional bank CajaAstur, as many of my Asturian friends are with them because they provide competitive rates.

    Regads,

  • #74156
    Profile photo of Anonymous
    Anonymous
    Participant

    Thanks Mike, this was my point the local/provinicial Banks should be the port of call.

    Going through Spanish/English Banks based in UK, The system does not work as who ever you speak to will reply with “Que”

  • #74163
    Profile photo of Anonymous
    Anonymous
    Participant

    Thanks so much guys for the advice. Have set aside a day or so of our two week trip to visit local banks and see what they can offer.

    😀

  • #74166
    Profile photo of Inez
    Inez
    Participant

    Sinead – ensure you tell them from which part of Ireland you are from, as Southern Ireland has different lending criteria. Take your passport with you to show them and have fun!

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