When purchasing a property in Spain, a down payment is usually required, often paid directly to the seller. Fynis International Mortgages arranges your mortgage before you sign the purchase agreement or make any payments. We are here to assist you in obtaining a mortgage for the purchase of a primary or second home in Spain with a minimum purchase price of EUR 350,000.
How does the process of buying a property in Spain with a mortgage work?
Important to Know
It’s important to note that definitive approval for a mortgage is only obtained when you receive a formal offer from the bank. This offer is called a FEIN (Ficha Europea de Información Normalizada). This document, consisting of about 20 pages, is binding. Preliminary agreements or estimates, on one or two pages, provide an indication but hold no legal weight. They are not binding offers but simulations. To obtain a FEIN, you need to apply for a mortgage with supporting documents and a property appraisal.
Explore Your Options: Mortgage Calculation
How does the process work in collaboration with Fynis International Mortgages? Before you embark on your property search, we would be happy to assess your financing options. We will provide a mortgage calculation. You can request one on our website through this page. Alternatively, you can calculate it yourself. You will receive our offer within one business day. Now you know the purchase price range within your means and can search for your dream home in Spain with a focused approach.
Making an Offer?
Have you found your dream home? The buying process begins with making an offer. Ensure your finances are in order before making an offer. A mortgage can cover a maximum of 70% of the purchase price. Including transfer taxes and other associated costs, you’ll need approximately 42% of the purchase price as your own funds. Make sure these funds are readily available in your bank account. Once you’ve set your sights on a property and made an offer, you’ll need to provide funds to proceed. Often, this amount ranges between EUR 2,000 and EUR 5,000 to take the property off the market. Prompt action is necessary. The seller and the process move quickly, and you may need to sign a purchase agreement committing to a down payment of, for example, 10% of the purchase price and a specific deadline for property transfer. If you still need to arrange things at this stage, you may risk being too late. If everything is properly arranged, you’ll get your down payment back, but not the initial payment.
Preliminary Agreement with the Bank
Prepare your file in advance. If your purchase depends on a mortgage, try to obtain as much certainty as possible regarding its feasibility during this stage. It’s possible to have your file reviewed and even request preliminary agreements from one or more banks.
Submitting the Mortgage Application
You’ve found a property you want to buy. Your financial file is prepared, and you have a good understanding of financing feasibility. You make an offer, and once accepted, we submit your mortgage application. You’ll have a representative by your side to assist with negotiations with the seller.
Property Appraisal – Final Offer from the Bank
Banks we collaborate with promptly process your mortgage application and provide an initial response on feasibility within one week. Sometimes, immediate approval is granted based on your financials, while in other cases, additional documents or clarifications may be required. You’ll receive a provisional approval outlining the proposed financing. If you decide to proceed, you authorize the bank to conduct a property appraisal. The bank verifies the property’s value and registration details, ensuring it matches the offer. If the appraisal result is satisfactory, you’ll receive the final mortgage proposal, the FEIN, which is binding for the bank. You can now sign the Spanish purchase contract (Contrato de Compraventa) and confidently proceed with any required down payment.
You can also sign the purchase contract earlier. In this case, it is crucial to ensure that if the purchase depends on obtaining a mortgage, the contract includes a suspensive condition. Additionally, it is of utmost importance that the condition is properly drafted. Your representative will advise you on this matter. Often, an immediate down payment is required by the seller, regardless of any suspensive condition. It’s best to have the down payment (10%) held in escrow.
Property Appraisal
When is the best time to schedule the appraisal? You can leave it to the bank. Banks typically conduct appraisals only after granting preliminary approval based on your financials. The appraisal process takes one to two weeks. Time constraints may become an issue, so it’s worth considering arranging the appraisal early in the process. Most banks accept appraisal reports from Tinsa or Gloval. For a property priced at EUR 350,000, appraisal costs range between EUR 400 and EUR 600. With one of the banks we collaborate with, there are no appraisal fees.
Property Transfer
Once you’ve accepted the final offer from the bank, a legal cooling-off period of 10 days applies. After this period, you can finalize the mortgage deed with a notary and complete the property purchase. You can appoint a representative to handle this process on your behalf. The bank plays an active role, coordinating with the notary and your representative.
Your Home under the Spanish Sun
Enjoy your home under the Spanish sun. If you have any further questions about your mortgage, feel free to contact Fynis International Mortgages!