morgage?

is it possible to get a firm morgage offer, before you hand over your 10% depsit on a property in murcia spain?

                                                                                               regards john

John,

You agree to hand over a 10% deposit when you sign a private contract to buy a property.  There are some things stipulated in law - non-performance penalties on both side for example - but basically the contract is whatever you decide to sign.  So you can make it a condition and have it written into the contract that the deposit is payable when you get a mortgage offer.  But two possible problems:

(1) the seller may not agree and, if he does, he will almost certainly want to continue marketing the property as you are not giving him certainty and he is not privy to your financial status and can't judge the likelihood of you getting a mortgage.  Any half decent estate agent would certainly advise the seller along those lines; and

(2) unless things have changed, Spanish banks don't give firm mortgage offer letters as in the UK.  The mortgage contract is the mortgage escritura which you sign at the notary at the same time as the property transfer escritura.  Until then, the banks don't feel 100% committed.

Your best bet is to talk to your local bank manager and ask him how much he would be prepared to lend you subject to survey.  Then talk to other banks and ask them the same.  Most will be happy to tell you - whether you have an account with them or not.  Ask for a schedule of costs which most will be happy to give you showing the additional costs - tax, survey fee, gestor, any admin charges, notary and property registry fees - all of which may be included in the loan amount; and monthly repayments.

John

What Jek says is correct and is the advice I would give to any of my clients that were in the same position

Do bear in mind that if you are buying a bank repossession and getting a mortage through the same bank that has repossessed the property you will be paying more than the property will be being offerred by another agent as the banks will want to cover the cost incurred in offering a larger mortgage that is more than normal.

There are many agents selling Polaris World properties cheaper than the banks are offering

Do your homework.

Thanks for the advice fpegman and jek, could you guys recomend a good agent etc selling property on polaris world murcia.

                                                                                        regards john

I am an agent selling property on Polaris World which development are you looking at

Hi John,

It is not possible to obtain a firm mortgage offer until after the survey of the property has been done. You can however get a Decision in Principle (once you have submitted the required documentation) and this is solely based on your financial circumstances. Most lenders will give this to you in writing, outlining the basic conditions; in some instances this will be by way of text in the body of an email or it could be a letter of acceptance, lenders differ in this procedure. Again, for the actual mortgage offer, there are several lenders that will provide a formal offer, in letter format, which is binding and must be signed by the client as agreeing to the terms and conditions, prior to completion.     All lenders now base their lending on the lower of either purchase price or valuation therefore it is not possible to include the costs in the mortgage amount.

This info is relevant to buying an independent property, not on the banks books and obtaining an independent mortgage.

Hi fred , yes i would be interested, the site is in murcia polaris world, hacienda riquilm, i may have spelt it wrong, anyway the jist of the situation is this, my son and i are getting a joint morgage (90%) a bank repo on above site. I was led to beleive you payed a 3000 euro deposit to secure the property so to speak, so i was a bit weary when within the space of a week they asked us for a 10% deposit of 9516 euro, with very little back up paper work ie offer of a morgage from cam bank who they say own the appartment, also the emails they sent my email fillters said they could be fraudulant but this maybe because they have added links? as i have no solid reason to think it is a scam. The other things are they are asking for the money to be ibaned to an office estate agent and not the bank who we are purchasing off? the firms name is villa cashback, they seem good according to web pages but who knows, but to be honest i lost money in spain in 2008 like a lot of people so i am a bit critical of every detail and as it is my second time round i want to make sure, hope all this makes sense, i would post my email to you but the forum say i need to be veryfied? i also have gmail webcam so maybe we can talk face to face at some point. so i will put my email in words so it wont detect it and we could corispond personaly   ( electricalandpattesting at gmail. com)

                                                                                                                                        regards john

Hi John - the normal deposit for reserving a property here is 3,000€ but CAM do ask for 10% so you can be confident that is their standard procedure.  They are incredibly slow at providing all the paperwork, we have been trying to complete for a client for weeks now and they seem to be constantly on holiday!

Sorry I don't know anything about Villa Cashback - but if you dealt with CAM direct then I don't understand why an agent is involved.  CAM do work direct and also via registered agents and you should know who you are actually dealing with.  Just ask!!

Some repossessions are fantastic value and some are not.  Some resales may seem to be more expensive but they tend to be fully furnished and repos tend to be stripped out.  However, the repos do have higher mortgage deals attached and the maximum mortgage for a non-repo will be around 60 - 70% of the buying price for non-residents.  As said before - do your homework!

All the best with your deal.

Thanks clare, we are assuming from what the agent says it is cam, i am just a bit nervouse to hand over 10% as it is alot to lose

                                                                                                                   regards john

Hi again - I understand your concerns.  You should be asked to sign a reservation contract, which your lawyer can check out for you before you pay the deposit.  I know you asked for a recommendation for a good lawyer but I don't know anyone in your area - sorry.

I think you also asked about costs in another thread - you should calculate approx 10% to cover lawyer, notary, land registry etc.

Regards