Mortgages

The mortgage market for non-residents buying in Spain has changed dramatically in the last 5 years.

There is now a much wider range of product available at loan to values that have increased significantly.

The changes include the requirement now to only have a 20% cash deposit & include 80% loan to values with one lender intending to launch a 90% product before the end of 2007.

Interest only once not available in Spain for either the non-resident or resident market is now common place and widely available. With some lenders it is now possible to set the mortgage up for the whole term on an interest only basis. This change allows buyers to mitigate Inheritance tax as the loan is deducted from the assessed value before the Inheritance Tax is calculated. In Spain unlike the UK there is no spousal exemption for Inheritance Tax purposes, IHT is therefore payable on the death of a partner for all assets held in the country at that point so securing a full term debt can help in your tax planning. There remains flexibility for buyers to decide to pay off the mortgage early or to make a percentage capital repayment yearly usually with no penalty.

Self certified mortgages up to 65% of valuation are also now available but are provided via lenders who only distribute through third party intermediaries and are not available through High Street Branches. Access to this product is only through mortgage brokers.

It is anticipated that by the end of 2007 a buy to let mortgage where personal income will no longer be the only income the bank assesses will be launched. This product will assist investor clients who can then use projected rental incomes to achieve borrowing.

Another significant change is the ability for existing home owners in Spain to release for any purpose up to 75% of the current value of an existing property using their Spanish property as security. It is now possible to use an existing property to raise deposits for further property investments in Spain or world wide, consolidate existing debts wherever they originate from or just to release monies for any pleasurable purchase required.

Fixed rates from 1 to 20 years can also be achieved giving you stability of payments and peace of mind and fixed rates previously well above prevailing variable rates are now far more attractive for potential purchasers.

For further information on the mortgage market in Spain and a free personal quote contact IMS who will be delighted to assist with any enquiry you have.

IMS

UK: +44 1462 481133
SPAIN: 902 517 007
advice@imsmortgages.com
www.imsmortgages.com

You may need to organise the following documents:

(depending upon your personal circumstances other documentation may be required)

Text provided by International Mortgage Solutions Ltd