How to Get a Mortgage in Spain for Non-Residents?

Por Ricardo Guillén Amo

Especialista en Telecomunicaciones

Are you dreaming of a holiday home on the Costa del Sol or a strategic investment in Madrid? Getting a mortgage in Spain as an expat is a well-trodden path, but the rules for those who do not live or pay taxes in the country are distinct from those for residents.

At Selectra, we’ve analysed the current financial landscape to answer the big question: Can I get a mortgage in Spain? The answer is a resounding yes, provided you understand the specific requirements for non-residents.

What defines a "Non-Resident" Mortgage?

In the eyes of Spanish banks like Banco Santander or Bankinter, your residency is determined by where you pay your income tax. You are considered a non-resident if:

• You spend less than 183 days a year in Spain.
• Your main economic interests are outside of Spanish territory.

Important Note: This guide focuses exclusively on non-residents. If you live and work in Spain, we recommend checking our general guide on Mortgage Loans in Spain to avoid confusion.

How to get a mortgage in Spain for non-residents: Key Requirements

Securing a mortgage as a non-resident requires meeting specific financial criteria that banks use to mitigate risk for international lending. Before you begin your application, you must be aware of the different lending limits and the upfront capital required for a successful transaction.

1. Loan-to-Value (LTV) Limits

The LTV is the percentage of the property value that the bank will finance. For non-residents, the conditions are stricter than for local residents.

• Standard Limit: Typically capped at 60% of the property's value.
• Exceptional Cases: Some banks may offer up to 70% for high-profile applicants with income in Euros.
• Appraisal Note: The limit is calculated on the lower value between the purchase price and the official appraisal (tasación).

2. Entry Savings and Costs (40-50% of Price)

You should prepare to have approximately half of the property price saved in cash to cover the following items:

• The Deposit: Between 30% and 40% of the price which is not covered by the mortgage.
• Taxes and Fees: Between 10% and 12% of the total price.
• ITP (Resale Properties): Between 6% and 10% depending on the region.
• VAT and AJD (New Builds): 10% VAT plus Stamp Duty (0.5% - 1.5%).
• Professional Fees: Includes Notary, Property Registry, and Gestoría fees.

3. Essential Documentation

Spanish banks require proof of the origin and stability of your funds. All foreign documents must be accompanied by a sworn translation.

• NIE: Your Spanish Foreigner Identification Number (mandatory).
• Proof of Income: Last 3 to 6 payslips and your employment contract.
• Tax Records: Income tax returns from your home country for the last financial year.
• Credit Report: An official credit score report from your country of residence.
• Bank Statements: Movements of the last 6 months to comply with anti-money laundering laws.

4. Critical Steps in the Purchase Process

Navigating the purchase involves several key milestones that ensure the safety of your investment.

• Arras Contract: A private agreement where a 10% deposit is paid. It should include a mortgage contingency clause.
• Legal Representation: Hiring an independent lawyer to check for hidden debts or legal issues on the property.
• Local Bank Account: Necessary for direct debits of mortgage payments, utilities, and local taxes.
• Signing the Deed: The final step performed before a public Notary.

Disclaimer: This information is for educational purposes. It is always recommended to consult with financial and legal experts in Spain before committing to a purchase.

Best Banks for Non-Resident Mortgages in Spain

Not all Spanish lenders offer the same terms for non-tax residents. Some institutions have developed specialized "Expat" or "World" divisions that cater specifically to foreign income and cross-border paperwork. Below are the leading banks currently providing competitive non-resident solutions.

Step-by-Step Process for Foreigners

Navigating the Spanish mortgage system involves several bureaucratic stages, from obtaining your mandatory identification number to the final signing at the notary. Understanding this timeline is essential for coordinating your property purchase effectively from abroad.

1. Get your NIE: You cannot sign a deed without this identification number.
2. Open a Spanish Bank Account: Necessary for monthly instalments and utility bills.
3. Property Valuation: The bank will send an appraiser to confirm the market value.
4. FEIN and FiAE: Review these official binding offers for at least 10 days.
5. Notary Signing: The final step to formalize the deed and receive your keys.