Buying a property, moorings, boat, Spanish Bank account and need financial advice

We are buying a 3 bedroom apartment in Sotogrande, a mooring and boat.

We have the funds to buy outright but understand that inheritance tax in Spain could be problamatical.

We will reside in the UK but use our Spanish assets to enjoy semi retirement.

Property

This is in the course of development at Ribera del Marlin expected to complete Dec 08. At the moment this is being paid for by stage payments, where we utilise HIFX to transfer our funds. We have been advised not to arrange a mortgage until the the development is almost completed - though I am unsure why. At that stage we will look to arrange an interest only mortgage - any suggestions?

Moorings

We have just purchased a 20m mooring. Anyone know of a competitive interest only mortgage available?

Boat

This is currently being built, ready May 08.

We have arranged an Italian lease at 8% VAT. This enables to hold our capital and drip feed the lease purchase. Over a 5 year period we will eventually pay for the boat and the effect of the VAT saving means we will pay the same amount of money over 5 years as we would have done, had we bought the boat outright in the UK at 17.5% VAT. In the meantime our cash is earning interest in a high interest account in the UK. Anyone know of any pitfalls/alternatives?

Bank Account

We need to open a Spanish bank account. Anyone any suggestions for best interest rates and low charges?

Mike and Carol, Stoke-on-Trent

Hi Mike and Carol to try to answer each of your points:

1. Property - it is impossible to arrange a mortgage on the property itself until there is something for the lender to secure on. They will need to confirm it is legal and that all the correct procedures have been followed in the obtaining of licences to construct and that it has its final habitation licence before they will advance a penny. Possible to get up to 25 years interest only up to 100% of purchase contract price subject to status. During the construction process the developer will likely have had a mortgage to fund the development and it is feasible that this migh tbe able to be subrogated to you at completion as long as it fits what you want - it will unlikely be long term interest only and they are relatively inflexible animals.

2. Mooring - impossible to borrow against a mooring at this time in Spain - unless there are specialist lenders out there and I have certainly never come across it.

3.Boat - sounds like a pretty good idea to me and cant see pitfalls

4. Wait until you know where you are going to hold the mortgage unless its absolutely vital to have an account in advance of that. Most (not all) lenders will insist on a current account with them if you have a mortgage there.

Thank you Patrick, very helpful.

I have been advised that there is finance available to cover moorings and will follow it up.

Regards

Mike