Buying a Property in Spain

1) You should know that purchase contract is a compromise arranged between you and the seller or the real estate agent. The contract should fix a payment schedule, completion date a proper description of the property. It is quite usual that the seller ask you for a deposit to reserve the property. 3000€ is usual and up to 10%. Once completion is coming, we contact you to give you a final breakdown which includes detail of expenses and after confirmation, the notary appointment is arranged and the sale finished.

It is quite important to open an account in Spain before completion is coming as last payment should be paid at the notary. This means the money for the final payment should be transferred to Spain at least 2 weeks before the appointment. A couple of days before the signing, we will order the proper figures at the bank so we can collect the cheque/cash there and go directly to the notary.

You should also take into account, the new Title Deeds in your name should be registered; this procedure will take approx. 1-2 months.

- An NIE number is essentially a tax number for foreigners in Spain. You need one if you are going to buy a house or a car, if you are going to work for a Spanish company or if you want to apply for a residency card.
To get an NIE number, we need to go with us to the foreign department at your nearest the police station .You will need to take your passport. The forms are fairly straightforward and you will have your NIE number within 2-6 days of applying

2) These are the expenses (figures approximated) you should pay when you buy a second hand property around 13%.
The agency commission is paid by the vendor
 
Notary: 700 Euros
Land Registry: 300€
Transfer Tax (10% over the value declared for the property)
Water electricity contract and direct debit for Suma office around 420€
NIE number 90 € per person
Registration fees 300€
Solicitors fees 800€

At the signing of the Deeds, we will take these approximated figures to meet all payments on your behalf. If you buy with a mortgage loan, the bank instead of us will retain these as they will be in charge of the registration procedure.

Document needed to open a bank account in Spain

- Latest income tax declaration P60 (where applicable).
- Copies of pay slips for the last 3 months.
- Copy of your passport
- Personal bank statements (last 3 months).

Finally, we would like you to know we will always work for you and we will do our best to make this process easier and clear for you. Our team will be very pleased to meet you.
 
We hope this information is helpful but if you need for further information, please do no hesitate to contact us.

Spanish mortgages
Please bear in mind if you buy a property with Spanish mortgage the cost will increase up to 3 or 4 % on the top of the 13% as their will be additional cost for notary and registry fees, bank commission, property insurance and life insurance and some additional tax

Main lenders:
Most Spanish banks (Sol Bank, Caja Murcia ) and Building Societies will offer mortgages for properties purchased on the Costa Blanca. The bank will enter into agreement with the purchaser and the loan can be increased up to a maximum of 50% for non member of the European community and 70 % for members of the European community of the valuation of the completed property.
    
The maximum amount you can borrow will also depend on your income. In general, the rule of thumb is that you will be advanced up to 3 times your gross annual income, but usually the monthly repayment should be under 33% of your net disposable income.    
          
Interest rates:
Interest rates for mortgages in Euro are based on EURIBOR (Euro Inter Bank Offered Rate).  The lenders will normally charge EURIBOR + 3%
Today around 6%
        
Interest rate review:
Interest rates will be reviewed annually, on the anniversary of the loan, then fixed for the period of one year until the next anniversary.

Maximum repayment term:
In general, the maximum repayment term is 15years, but up to 25 years can be arranged. This will be dependent on the age of the borrower. The eldest partner must not go beyond his 70th birthday by the end of the term of the mortgage. This means that for a couple, where the eldest partner is currently 55 years old, the maximum repayment term on offer would be 15 years.

Early repayment:
Most lenders will permit early repayment. The cost of this will vary from zero to 1% depending on the loan. Some lenders charge for cancellation only in the first 5 years. You must let us know if you are considering an early repayment option, so we can choose the appropriate lender for you.

Documents required:
The documentation required will vary from one lender to the next. As a general guideline we have listed most of the paperwork you are likely to need, it is a good idea to prepare much of these as soon as possible.

If you are employed you will need to produce:
- Latest income tax declaration  P60 (where applicable).
- Copies of pay slips for the last six moths.
- Credit report
- Copy of your passport.
- Personal bank statements (last 6 months).
- Job certificate

We will help you:
To choose your lender, carefully considering all of the many variables that need to be considered, including the location and type of property. Keeping up to date with all the banks current offers, terms and conditions, knowing their requirements and matching them to those of the client is a highly specialized job, which is why we use our in-house independent mortgage advisor at LA CASA BLANCA ESTATES
Should you have any questions or require more information please do not hesitate to ask.

If you are looking to buy a property in the Costa Blanca and would like more information then contact us at info@lacasablancaestates.com