A mortgage in Spain as a foreigner: how it works

Spanish banks typically finance up to 70% of the purchase price or the appraised value for non-residents, whichever is lower. For residents, that percentage is often higher, up to 80%. That means you'll need to finance the remaining 30% plus the additional purchase costs (9 to 14% of the purchase price) from your own funds.

The exact ratio depends on your income, existing debt obligations, and the bank itself: some banks are more cautious about a second home or a property you intend to partly rent out, while others actively cater to that.

Expect to provide: a valid passport and NIE number, the last two to three years of tax returns, recent payslips or, if self-employed, annual accounts, an overview of existing loans and obligations, and bank statements from the last few months.

Spanish banks typically apply a fixed debt-to-income ratio: your total monthly obligations, including the new mortgage, usually can't exceed 35 to 40% of your net income. This is checked strictly, even with substantial equity.

Both fixed and variable mortgages are common in Spain. A variable mortgage is usually linked to the Euribor plus a margin, and is reviewed annually. A fixed mortgage gives certainty over the full term, but often starts at a slightly higher rate.

Which option suits you best depends on your risk appetite and how long you expect to keep the property. We refer you to an independent mortgage adviser who compares offers from multiple banks side by side, rather than checking just one.

Since Spain's 2019 mortgage law (Ley 5/2019), the bank pays most of the formalisation costs of the mortgage deed: the stamp duty (AJD) on the mortgage, the notary fees for that deed, and registration in the mortgage registry. As the buyer, you still pay the valuation (typically €300 to €600) and any advisory fees.

Always ask for the full binding cost statement (oferta vinculante) before you sign, so you know exactly what the bank covers and what falls to you.