Mortgages in Spain for international buyers: What you need to know

The idea of acquiring a property on the beautiful Costa del Sol, and especially in places like Nerja, attracts thousands of international buyers every year. However, the financing process can raise many questions, especially if you are not familiar with the Spanish banking system. At Narixa Villas, as your trusted real estate agency in Nerja, we want your experience to be as smooth as possible. That's why we have prepared this comprehensive guide on how to obtain a mortgage in Spain for international buyers.

From essential requirements to associated costs and available financing types, here you will find all the necessary information to take the next step towards your dream home in Spain.

Can foreigners get a mortgage in Spain?

Absolutely yes! Non-resident citizens in Spain (whether from the EU or outside the EU) can apply for and obtain a mortgage to finance the purchase of a home. The process is similar to that for residents, but with some particularities regarding documentation and terms.

Key difference: financing for residents vs. non-residents

While a Spanish resident can finance up to 80% of the purchase or appraisal value (whichever is lower) of a main residence, non-residents usually have a lower financing limit. Generally, Spanish banks offer up to 60-70% of the purchase or appraisal value.

Key requirements to apply for a mortgage as a non-resident

Spanish banks rigorously assess the applicant's solvency. Here are the main requirements and documentation you will be asked for:

1. Stable financial situation:

• Sufficient income: you must demonstrate stable and recurrent income. The general rule is that the monthly mortgage payment (plus any other loans you may have) should not exceed 30-35% of your net monthly income.
• Credit history: although the bank will check your credit history in your country of origin, it is crucial not to have unpaid debts or a negative history.
• Savings: in addition to the non-financed percentage of the property (30-40%), you will need to cover the costs associated with the purchase (taxes, notary fees, etc.), which can amount to an additional 10-15% of the purchase price.

2. Essential documentation:

• NIE (foreigner identification number): this is essential for any financial and legal transaction in Spain. You can obtain it through the Spanish embassy in your country or at a police station in Spain.
• Passport or ID: valid identification.
• Non-residence certificate: issued by the Spanish police.
• Proof of income:
  • Employees: employment contract, latest payslips (3-6 months), income tax return for the last 1-2 years.
  • Self-employed/business owners: tax returns (1-3 years), company bank statements, annual accounts.
• Bank statements: from your main accounts for the last 6-12 months.
• Certificate of ownership of assets and debts: CIRBE (Bank of Spain Risk Information Centre) report or similar credit report from your country.
• deposit/reservation contract: the property purchase agreement.

Narixa Villas tip: gather all this documentation in advance and, if necessary, obtain sworn translations. A complete dossier speeds up the process.

Types of mortgages available for non-residents

Spanish banks offer various options, although for non-residents, the most common are:

• Fixed-rate mortgage: the monthly payment remains unchanged throughout the life of the loan, offering stability and predictability. Ideal if you are looking for security against interest rate increases.
• Variable-rate mortgage: the payment is revised periodically (e.g., every 6 or 12 months) based on a reference index (mainly Euribor) plus a fixed differential applied by the bank. It can be cheaper initially, but involves more risk.
• Mixed mortgage: combines a fixed rate for the first few years (e.g., 5 or 10 years) and then becomes variable. A good option for those seeking short-term stability with future flexibility.

Costs associated with the mortgage and property purchase

In addition to the purchase price, consider the following expenses:

• Appraisal costs: cost of the official valuation of the property (approx. €300-600).
• Opening fee: some banks may charge it (although it is less common now).
• Notary and property registry fees: related to the formalization of the mortgage (the bank covers most of these, according to the current Mortgage Law).
• Administrative agency fees: if you hire one to manage the processing (highly recommended).
• Purchase taxes: vary depending on whether it is new build (IVA + AJD) or second-hand (ITP). In Andalusia, ITP is 7% and AJD is 1.2% (applicable to new build and the mortgage).

Remember: these additional expenses can add up to 10% to 15% of the purchase price, so it is vital to factor them into your budget.

Which banks offer mortgages to international buyers?

Most major Spanish banks have specialized departments for non-residents. Some of the most active in this segment include:

• BBVA
• Banco Sabadell
• CaixaBank
• Santander
• Bankinter

It is advisable to contact several banks or work with a mortgage broker who has experience with international clients to compare offers and find the best conditions.

Key Narixa Villas tips for your mortgage in Spain

1. Organize your documentation: have everything prepared and up-to-date.
2. Get your NIE as soon as possible: it is the indispensable first step.
3. Calculate your expenses: don't just think about the mortgage payment, but all the costs associated with the purchase.
4. Consider a mortgage broker: they can save you time and get you better conditions.
5. Legal advice: hire an independent lawyer to review all contracts and advise you at every step.
6. Pre-approval: if possible, seek mortgage pre-approval before signing the deposit contract. It will give you security and speed up the purchase process.

Your Spanish dream within reach with the right financing

Obtaining a mortgage in Spain as an international buyer is a totally viable process, although it requires preparation and a good understanding of the requirements. With the right information and adequate support, financing your property in Nerja or anywhere on the Costa del Sol can be a simple experience.

At Narixa Villas, we not only help you find the perfect property, but we also accompany you throughout the entire purchase process, offering contacts and guidance on financing and legal aspects. If you are ready to take the step, contact us today and let's make your Spanish dream come true.

This article is for informational purposes only and does not constitute financial or legal advice. Always consult with a mortgage expert and a lawyer specialized in Spanish real estate law.