Bank repossesed property & mortgage

Hello Everyone,

I am planning to buy an apartment in around Villamartin, Costablanca. I would need a mortgage. Is it safe to buy a Bank repossesed property ? Is it possible to get a mortgage on a repossesed property ? Any help will be much appreciated.

Cheers,

Arindam

Mortgages are very difficult to get at the moment, why not try to find someone selling who already has an existing mortgage you can take over.

This might be easier.

Joan

Try Solbank in Cabo Roig they are giving out mortgages at the moment

Generally most banks are still giving mortgages although criteria have tightened since the arrival of credit crunch. There is a great deal more attention paid to purchase price than used to be the case (used to be only based on bank valuation which was invariably higher). Much more due diligence in terms of income assessment and ability to pay ratios. If it is a bank repo you need to be careful that there are no other debts lodged on the property (community fees, IBI, property taxes, utility bills) as these are debts recorded against the property and not the previous owner thus you could inherit someone elses debts. If a bank has repod a property then they would very likely advance a mortgage on it (subject to your meeting criteria) and the % they may advance may well be higher than a third party lender - CAM certainly were doing this and also Bancaja - but tread with caution - the bank MAY give an inflated valuation against what the property might sell for on the open market.

Client recently had been offered a property as a bank repo for 150,000€ - was offered a 90% mortgage. Having looked around she found a better property in better location (bigger sq m, newer, better facilities and condition) for 30,000€ less. Strangely enough the original bank was only willing to offer her 50% of the purchase price to buy this one.

Remember the three watchwords - Research, Research and Research.

Thanks very much for your input folks. Appreciate it very much. Just wondering will the local solicitor be able to find out the debts associated with the property? Big thanks to smiley for sharing the info.

Hmmm can of worms.......In theory your lawyer should be able to establish that all bills are up to date and paid - this could be easy or difficult (the wrong way, the right way and the Spanish way) depending on whether those debts have been recorded at the Land Registry - in which case they will be on the Nota Simple. But Spain is a bureacratic nightmare and sometimes debts do not get recorded promptly - water bills for example can run 2 or 3 years behind. Unpaid community charges can take 3 or 4 years to catch up.

Now subject to how diligent and efficient your lawyer is (and whether he prefers a coffee and Tapas to dotting all the i's and crossing all the t's) he should be aware of all and every debt likely to be associated with a property and he should be able to check that everything is in order and what is outstanding. Make sure you get a good lawyer.

Hi - if you use a decent agent then they too check all debts on the property and will provide a statement from the Administrator to show that the community charges are paid, as well as proof from the utility companies that they are paid up to date also. 

There are lots of repossessed properties in Villamartin but, as others have said, they are not necessarily the best value.  I know of one here (very close to Villamartin) which is on the bank's books at over 190,000€ and I have the same for sale for 125,000€.  The bank property comes with a great mortgage deal and you can probably put in a low offer, but it might not work out the best deal.  You will also find that many of the repos have been totally stripped whereas a resale will usually come fully furnished and equipped.

There are good deals to be had on both sides but just take your time and check out all your options. 

Thank you very much Claire T

Hi Arindam

I've changed Spanish solicitors twice.  For many reasons, one of them being that the ones I have used do not have the same idea of customer service as we are used to in the UK.   If I use a lawyer it is usually for something important, and I expect to have some form of effective communication with them.  Not so.

I know use Spanish Solutions near the La Zenia roundabout.  They are on the ball, responsive and have never let me down.  I am happy to recommend them from my own eperience.  Best wishes.