Late starter for a Spanish mortgage

Hi all

I've been looking at property for sale in Mallorca. I'm 64 in just over a months time, due to retire at 65 but am thinking of staying on for 2 more years....retiring at 67.

What are the options for me to obtain a Spanish mortgage on a property costing a maximum of 150 000 euros...or is it even possible at my age?

Thanks in advance

Frank

Hi Frank,

most spanish banks cap the age at term to 70 years old, but one or two will allow you to borrow until aged 75, so in your case a 10 year mortgage would be possible, subject to you meeting the banks affordability criteria.

Feel free to contact me if you need any more help.

The  monthly repayments on  €150,000 would be astronomical even if you could get one...you can use the mortgage calculated repayments advise freely available on the net .Why not just rent it will come to a fraction of the cost of buying.

Thanks for your replies...The 150 000 euros is the maximum cost of a property.the mortgage would be around 85000.

A fixed rate mortgage for 10 years, 85.000 capital borrowed would be around 800€/m.

Thanks Tim

Hello Frank,

Before you consider a mortgage, make sure you obtain competent advice about Spanish mortgage law, which is completely different to UK law.  Any changes to a mortgage can be very costly, because they have to be noted at the land registry, so if your situation changes in the next few years you may find it difficult or costly to make adjustments to your mortgage.  Details of your mortgage are included in the deed of purchase so it's never as simple as negotiating with your bank.  Do it if it works for you, but make sure you know exactly what your rights are over the full length of the mortgage term, and what terms and conditions you are signing up for.  For example I have known it cost 1100 euros to make an amendment to the mortgage.

Best wishes.

Thanks Hosilverlaning.....yes that's good advice....the other option is to save up for longer and buy outright. :)

Good advise Hosilverlining!

The goodpart is that Finance/Mortagge Consumers rights are being more and more reinforced in Spain through law and  through Court Decissions.

But... of course, a legal eye is always a good investment as there is a lot to save !

Main aspects to be checked when hiring a mortgage:

- Mortgage deed related expenses

- Ordinary interests index

- Delay interests

- Payment default commissions

- Anticipated enforcement after default

- Related insurances

- Property valuation

- (....)

Before you consider buying a property in Spain have a good look at the inheritance tax rules and how they would affect you . I believe it is better to buy in Portugal their tax laws are different especially at your age.

Hi guys, im 42 and moving to spain with my family. I will be fully employed with the company I am currently with. They will ensure that any banks or authorities are satisfied that my contract is permanent and what my salary level is. I will have a spanish adjusted salary, not an expat salary as this move is an emiigration. If we were to buy a house for 250,000 and lend 160k-180k on a repayment mortgage over 20-25 years, what would be the ball park monthly repayments? Thanks!

That’s absolutely great, guaranteed salary ‘permanent’ for 25 years, providing your employer does not go bankrupt. Hope they’re not an airline.

About 1,000 per month.

Presumably you will be borrowing the money, not lending it!

Why buy a €250,000 property in your case at €1,100 per month ...when you can rent it for around €600.00 per month and when you want to move on you... just hand the keys back to to landlord... Its a different story when you try sell a property anywhere in spain...I think it is better if you rent for a couple of year's before you even think about buying .

I tend to agree with windtalker  why take the risks, worry and expense to just end up with a near worthless pile of Spanish bricks, like most of us already own.

Hi Frank

I agree with both windtalker and Duncan, regarding renting rather than buying.

There are so many pitfalls to getting a mortgage. Luckily I paid mine off within 7 years after taking it out for a 15 year term. One of the things that some of the banks insist on is having their life insurance policy. Mine was costing me 90 euros a month!

Also there is the inheritence element of the property whereby you will end up paying inheritence tax on it when you die, regardless of your worth.

Hi All

We have been renting for some years now, 4 in our current flat, and have decided to continue renting rather than buy.

As has been said, why bother landing ourselves with a large mortgage and all the problems that can go with it !

We have just signed another 3 year contract on our flat :)

Frank