Mortgage Information

Hi

We are looking to buy 2 properties in Spain with a combined value of 350k which one will be rented out at about 375pm and the other we will live in while I commute to london.  We have a property bought for 115k but prob worth about 70-80k  which we would like to use as collateral as it has no mortgage.  I earn 75k in the UK.  Any advice on the best way to proceed?

 Hi, there was a guy that used to post on here under the name of "smiley", real name Patrick Robinson. He is a mortgage advisor and really knows his stuff! Although we didn't use his company, he gave us some good advice and seems like a really knowledgeable guy.

Smiley - patrick@marbellamortgages.com  www.marbellamortgages.com

This information may help you:

http://www.eyeonspain.com/blogs/costaluz/2433/legal-tip-163-a-guide-for-successful-house-buying-part-v.aspx

Hi jpdaus,

It is very unlikely that the property you own can be used as collateral; lenders are only interested in your financial circumstances and your ability to repay the mortgage. Generally mortgage approvals are granted against a percentage of  your debt to net income ratio i.e. the total of all annual financial commitments e.g. mortgage repayments, (including the new proposed Spanish mortgage repayments), personal loans and outstanding credit card balances. These combined must not amount to more than this percentage. Depending on the lender, the percentage can be as much as (and to a maximum of) 50%.   It may be helpful to know that some lenders will impose a higher rate margin when you already own a property in Spain as they deem any subsequent purchase to be for investment purposes.

banks are very cautious these days and most unlikely they will consider the anticipated rental income of the property you intend acquiring.

It was buy to rent that caused this problem in the first place ......

If you were Spanish and had a guarantor then different story ....

If you don't know where to start when it comes to mortgages, then start here! Buyingmortgage in Spain can be a good investment once you have planned and researched your investment. Why Spain? As the number of people investing to buy holiday homes increases in UK and other European countries, the warm climate in Spain provides a big appeal.

If you don't know where to start when it comes to mortgages, then start here! Buyingmortgage in Spain can be a good investment once you have planned and researched your investment. Why Spain? As the number of people investing to buy holiday homes increases in UK and other European countries, the warm climate in Spain provides a big appeal.

If your main income is still being generated in the UK, try speaking to one of the UK Banks with offices on Gibraltar. Several do Spanish mortgages. They will though have as strict, if not stricker criteria on affordability than their Spanish counterparts. You would have option of borrowing in Euro's or £, where if your main income is still in £ would be worth considering and thus avoid the vagries of exchange rate movements, although it is still predcited for £ to strengthen against the Euro over the next 2 yrs.

Don't forget they will take into account the costs of your UK accommadation whilst working in UK.

Good luck

I would avoid using british banks as they will treat the application under the same rules as the UK, ** EDITED - Against forum rules **