Spanish property mortgage Merck Estates Halifax Spanish mortgage partner offering professional advice on Spanish mortgage benefits.

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Once you find the right property on the Costa del Sol through Merck Estates you may need some advice on the benefits of Spanish mortgages. Whether you have purchased an investment property, a holiday home, a new development, a resale property, or a property with a guaranteed rental income on the Costa del Sol, getting the correct financial advice is essential. As our ethos is to 'hold your hand' Merck Estates will advise and guide you with all aspects of buying property in Spain, including financing your purchase with a Spanish Mortgage if required.

For non residents the maximum loan-to-value of a Spanish mortgage is 70%, which means a deposit of 30% plus IVA is required if you are purchasing a property off plan and you can take out a Spanish mortgage upon completion for the remaining 70% the same rule applies to a resale property. The legal and arrangement fees are additional and must be paid by the borrower. When Spanish mortgage lenders consider your loan application, they will not take into account any potential income from renting out your Spanish property.

If you are in full-time employment, the Spanish mortgage provider will sanction the loan depending on your income from your last three pay slips and your P60 document. You will need to submit copies of the same as well as any other documents they may require. If you are self-employed, your income will be calculated as your average annual net income over the previous three years. You will require evidence to support this, as you will not be able to obtain a self-certification Spanish mortgage. In the past, self-Employed, and also company directors, have found it very difficult to find Spanish mortgage lenders who are willing to sanction their loans without submitting their full statement of accounts.

Self-employed applicants can now state their income level on an application form and supply all supporting documentation. this allows the borrower to state their total income rather than the figure which is finally presented to the Inland Revenue for taxation purposes. As a general rule, 35% of your net income should be sufficient to cover all existing outgoings and the Spanish mortgage lender verifies that your total monthly payments to be made should not exceed 35 % of your net monthly disposable income. 'Outgoings' that are taken into account are your existing debt and any other regular payments, such as any mortgage repayments at home, rent, personal loans and any other commitments. You may also submit proof of any other secondary investments which will earn you dividends in the future for consideration.

Spanish Mortgage periods may extend from 10 to 30 years. Once you have decided on your dream home, the bank will send a valuer from its panel of valuers to carry out a survey of your property for mortgage purposes. You must cover this additional cost before the valuation is undertaken.

Banco Halifax is well known in Spain as the leader in Spanish mortgages and there are good reasons for this. At Halifax, we know that taking out a mortgage is probably the most important financial decision that you will make in your life. That is why our products are designed to make this process easier:

• Straightforward ways to pay your mortgage.
• We will always offer a range of products to meet your needs throughout your life. Our Spanish mortgage products are available for the purchase, construction or refurbishment of property, or remortgage from other lenders.
• Capital Repayment Mortgage: for those customers who wish to borrow up to 70% of the valuation of the property and repay between a 5 to 30 year term.
• Interest Only Mortgages: for those customers who wish to repay interest only for any period up to 10 years of the total mortgage term.
• Construction Mortgage: for those customers who have purchased a plot of land and wish to build a property Banco Halifax Hispania will offer up to 60% of the valuation and a percentage of this will be released at the key stages of the construction.
• All documents are in plain English and fully comply with the Spanish legal system. Please note all official contracts are in Spanish according to the Spanish legal system.
• We will guide you through each stage of the Spanish mortgage process and help ensure everything goes smoothly by providing speedy provisional mortgage offers, valuing your property, and handling all the necessary paperwork. And what is more you can be sure of a personalised quality service and a provisional mortgage approval within 48 hours.

Requirements for a Spanish mortgage

• Non resident Certificate (available from Banco Halifax).
• Monthly transfer order to your current account in Banco Halifax to cover loan payment.
• Latest 3 pay slips.
• Latest Tax return.
• Insurance required on your property.

1. Please ensure that you will have full title to the property on completion and that the 'Nota simple'(this is the document that confirms the legal registration of the property), is available for the lender. This document is required before a valuation can be carried out.
2. With new properties, find out the date the property will be registered in your name(s), as the lender cannot lend on the security of the property until it has been registered.
3. Check with the estate agent/vendor that you are aware of the costs charged by the legal & government authorities for purchasing a Spanish property, noting that the lender will have their own legal costs for assigning the loan (the cost of which they will normally advise when they issue the mortgage offer).
4. The completion of a Spanish mortgage takes place in front of an appointed Spanish notary and all parties to the mortgage, including the vendor, lawyers and a representative of the lender need to be present. However a power of attorney may be used to sign on your behalf for the Spanish mortgage and land deeds. A copy of this power of attorney will need to be presented to the lender in good time before completion.
5. A Spanish bank account will be required and some lenders offer this as part of their service, but not all.

Merck Estates will manage your expectations with regards to the timescales involved in purchasing property on the Costa Del Sol, which are pivotal to arranging a successful completion. We will advise on the documentation you must provide. We will constantly liaise with the lender on your behalf. We will make certain that your mortgage application is processed and approved expediently