NON-RESIDENT MORTGAGE
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Mortgages for non-residents in Spain are financial products designed for foreigners who wish to acquire property in the country without having permanent residence. These mortgages usually have slightly different conditions than those offered to Spanish residents.
Spanish banks generally require the non-resident applicant to contribute a higher down payment, often between 30% and 40% of the property value, compared to the usual 20% for residents. Interest rates also tend to be higher, reflecting the greater risk perceived by financial institutions.
The repayment term for these mortgages is typically shorter, typically between 20 and 25 years, rather than the 30 years commonly offered to residents. Banks also require more extensive documentation, including proof of income, tax returns from the country of origin.
Importantly, non-residents may face more restrictions on their choice of mortgage products, with fewer options for variable or mixed rates. Additionally, some banks limit the percentage of income that can be allocated to the mortgage payment, generally around 30-35% of monthly net income.
Despite these stricter conditions, many foreigners continue to choose to buy property in Spain, attracted by the climate, lifestyle and investment opportunities. It is advisable that non-residents interested in purchasing property in Spain consult with several banks and possibly a specialized mortgage advisor to obtain the best possible conditions.
Non-resident mortgages: Do you want to buy a home in Spain?
We explain what mortgages for non-residents in Spain are, the necessary requirements and which banks offer them.
Mortgages in Spain for non-resident foreigners
What are the mortgages in Spain for non-resident foreigners?
Buying a house abroad is the dream of many, although only some make it happen. In Spain, the purchase of homes by foreigners from European countries has increased rapidly. However, American and Latin American citizens are also increasingly interested in purchasing a home in Madrid, which often involves applying for a mortgage loan, especially given the surge of Latinos purchasing real estate in the city.
In this article, we explain what a mortgage for non-residents in Spain is, the requirements that must be met and which banks offer this service. It is important to seek advice from financial and real estate experts who help identify the ideal type of financing and the right home according to the budget and desired lifestyle.
Content:
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Can a mortgage be obtained in Spain for non-residents?
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What are mortgages for non-residents in Spain?
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What requirements must I meet as a non-resident to buy an apartment in Madrid?
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Which banks in Spain offer mortgages for non-residents?
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Is it worth applying for a mortgage in Spain to buy a house?
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Non-resident mortgage FAQs
Obtaining a mortgage in Spain to buy a house in Madrid as a non-resident is possible.
Yes, it is possible to obtain a mortgage in Spain to buy a house in Madrid as a non-resident. Currently, there are platforms that simplify the process of acquiring a mortgage and buying a home from abroad. Although acquiring a home with a mortgage outside the European Union involves special requirements, good planning and expert advice can make this important investment possible. Tip: Before applying for a mortgage for non-residents, it is necessary to have a purchase agreement and have carried out an appraisal of the apartment or house. The real estate advisors at Brokers Finance can support you in this important process. Furthermore, in our section of advice and housing offers in Madrid, you will be able to learn about the unique characteristics of each neighborhood in the Spanish capital.
Can a mortgage be obtained in Spain for non-residents?
Mortgages for non-residents in Spain are loans that banks offer to those who do not have their tax residence in Spain. Regardless of nationality, it is possible to apply for a mortgage as a non-resident, as long as the necessary documentation for the procedure is prepared. Clarification: Mortgages for foreigners in Spain are a different credit that should not be confused with mortgages for non-residents. These mortgages are aimed at foreigners with tax residence in Spain.
What are mortgages for non-residents in Spain?
What requirements must I meet as a non-resident to buy an apartment in Madrid?
Being a non-resident, or living outside the European Union, implies stricter requirements to obtain a mortgage. In addition, financial institutions usually grant less credit than they would give to Spanish residents. For those who want to buy a house in Madrid with credit, it is advisable to have between 40% and 50% of the value of the home you want to buy. Requirements and necessary documents: Photocopy of the NIE (Foreign Identification Number) and passport. Copy of employment contract and company certificate, to demonstrate economic income and seniority in the company. Bank report for the last six months and the last six receipts in case of outstanding debts. Three last payrolls. Income tax return. Agreement or contract of purchase/sale.Proof of address.Clarification: The requirements may vary depending on the bank, and each entity establishes the form of delivery of the documents.Other requirements of banking entities for non-residentsEach bank may request different times, forms and documents.
Applying for a loan to buy a house in Madrid from abroad is more elaborate because banks want to make sure that the borrower can repay the loan. If you cannot pay, it is more difficult for the bank to collect the debt. Therefore:Interests are usually higher.The percentage of financing is usually lower (up to 60% of the appraised value of the home at most).Mortgage terms depend on the age of the borrower, but the terms 20 years are the most common for non-residents.
Some of the best Spanish banks that offer mortgages to non-residents are:
- Mortgages for non-residents of Santander: Financing up to a maximum of 60% of the appraisal value for homes with a purchase price of up to 300,000 euros, and up to a maximum of 70% of the appraisal value for homes with a purchase price of more than 300,000 euros. Financing may not exceed 80% of the purchase and sale value. Mortgages for non-residents of
- CaixaBank: Its digital service allows residents of non-European countries to register for HolaBank. This service facilitates some steps for non-residents, such as assistance in obtaining the NIE. CaixaBank finances up to 70%, although they recommend counting between 40% and 50% of the value of the house you want to buy in Madrid. Mortgages for non-residents of
- Bankinter: It offers mortgages for non-residents, although its fixed mortgage is only available for residents of the European Union. From their website you can access the conditions according to the country of origin.
Which banks in Spain offer mortgages for non-residents?
The main Spanish banking entities offer mortgage loans to non-resident foreigners. More and more entities are joining this service, especially since the increase in foreigners buying apartments in Spain. However, the majority of these mortgages are focused on residents of European Union countries. In the specific case of the United States or Latin America, the process is more extensive and it is recommended to approach financial and real estate experts to consult each financial institution. Credit may be easier to grant if you have a large part of the value of the home, if the years to be paid are less than 20 years, and if the person has sufficient income to cover this cost during the agreed years. Another alternative is to request a loan in the countries of origin.
Consult our guide on Brokers Finance for more information. The most transparent and digital purchase and sale of real estate At Brokers Finance we offer you a personalized experience in the purchase and sale of your property.
Meet our consultants in Madrid!
Is it worth applying for a mortgage in Spain to buy a house?
Consult our guide on Brokers Finance for more information. The most transparent and digital purchase and sale of real estate At Brokers Finance we offer you a personalized experience in the purchase and sale of your property.
Meet our consultants in Madrid!
Our clients ask
What is a mortgage for non-residents?
A non-resident mortgage is a loan designed for foreigners who wish to purchase property in Spain without having permanent residence in the country. This type of mortgage usually has stricter conditions than those offered to residents, including a higher down payment, higher interest rates and shorter repayment terms. Banks require more extensive documentation and may impose greater restrictions on the mortgage products available to these customers.
What documentation is requested for a non-resident mortgage?
Personal documentation 1.1. Valid passport or identification document 1.2. Foreigner Identification Number (NIE) 1.3. Non-residency certificate (if applicable) Financial documentation 2.1. Proof of income 2.1.1. Payrolls for the last 3-6 months 2.1.2. Income tax return for the last 2 years 2.2. Bank statements from the last 3-6 months 23. Certificate of ownership of bank accounts Working Information 3.1. Work contract 3.2. Letter from the employer confirming seniority and salary Asset documentation 4.1. Proof of other real estate 4.2. Investment or savings certificates Property Specific Documentation 5.1. Purchase and sale contract or deposit 5.2. Property appraisal Additional documentation 6.1. Work life (if you have worked in Spain) 6.2. Home country credit history 6.3. Life insurance (may be required by some banks)
Is a mortgage from a Spanish non-resident the same as a foreign one?
Although both cases are considered mortgages for non-residents, there are some differences between applying for a mortgage as a Spanish non-resident and as a foreign non-resident to buy in Spain: A Spanish non-resident generally has certain advantages. Having Spanish nationality, it is usually easier for you to obtain the NIE and understand the bureaucratic processes. Additionally, banks may perceive lower risk due to cultural and linguistic familiarity. On the other hand, a non-resident foreigner may face more challenges. You may need more time to obtain the NIE and may have difficulties with the language and understanding of the Spanish legal system. Banks could apply stricter conditions, such as higher interest rates or require a larger down payment. However, the main difference lies in the documentation required. A non-resident foreigner will have to provide more translated and possibly legalized documents, while for a Spaniard this process will be simpler. In both cases, banks will carefully evaluate payment capacity and financial stability, but may be more rigorous with non-resident foreigners.
What are the steps to request a non-resident mortgage?
The steps to request a mortgage for non-residents in Spain are as follows: Obtain the NIE (Foreign Identity Number) if you do not already have one. Gather all necessary documentation, including proof of income, bank statements and identification documents. Investigate and compare offers from different banking entities that offer mortgages to non-residents. Choose the property you want to buy and obtain an official appraisal. Submit the mortgage application to the chosen bank, along with all the required documentation. Wait for the bank's evaluation, which will analyze the payment capacity and the risk of the operation. If the application is approved, negotiate the final conditions of the loan. Sign the mortgage contract before a notary, along with the deed of sale. Register the mortgage and the new property in the Property Registry. This process may vary slightly depending on the bank and individual circumstances. Evaluate Your Current Mortgage: Review the terms and conditions of your current mortgage, including the interest rate, fees and terms. This will help you determine if surrogacy is a beneficial option for you. Search Offers in the Market: Investigate the different offers available in other financial entities. Compare interest rates, terms and any additional costs they may involve. Contact a New Bank: Once you find an attractive offer, contact the new bank to request subrogation. Provide information about your current mortgage and your financial circumstances. Feasibility Study: The new bank will conduct a feasibility study to make sure you can meet the new terms. This may include a review of your credit history and ability to pay. Property Appraisal: The new bank will likely request an updated appraisal of your property to confirm its value and ensure it is suitable as collateral for the mortgage. Signing of the New Contract: If the new bank approves the subrogation, the new mortgage contract will be signed. This process is usually carried out before a notary. Payment to the Old Entity: The new bank will be responsible for paying the outstanding amount of your current mortgage to the old financial institution. Formalization of the Change: Finally, the mortgage change is registered in the Property Registry, thus formalizing the subrogation. By following these steps, you can achieve a successful mortgage subrogation that allows you to save money and improve your financial conditions.
What taxes does a non-resident owner pay in Spain?
Owning a home in Spain entails several tax obligations. The main taxes to consider are: Real Estate Tax (IBI): It is an annual tax paid to the town hall where the property is located. Its amount varies depending on the cadastral value and the location. Non-Resident Income Tax (IRNR): Non-residents must pay this tax annually, which is calculated on a percentage of the cadastral value of the home. Wealth Tax: Applicable if the value of the assets in Spain exceeds a certain threshold, which varies depending on the autonomous community. Garbage fees and other municipal services: Although they are not strictly taxes, they are recurring expenses associated with the property. Tax on the Increase in Value of Urban Land (municipal capital gain): Paid when selling the property, based on the appreciation in the value of the land. Personal Income Tax (IRPF) or IRNR for rental: If the home is rented, the income must be declared and taxed. The amount and application of these taxes may vary depending on the autonomous community and the municipality.