{"id":1442,"date":"2023-03-06T10:35:00","date_gmt":"2023-03-06T07:35:00","guid":{"rendered":"https:\/\/alegria-service.com\/?p=1442"},"modified":"2023-10-09T11:35:35","modified_gmt":"2023-10-09T08:35:35","slug":"mortgage-in-spain-in-2023","status":"publish","type":"post","link":"https:\/\/alegria-service.com\/en\/blog\/mortgage-in-spain-in-2023\/","title":{"rendered":"Mortgage in Spain in 2023"},"content":{"rendered":"

The Spanish real estate market is undergoing certain changes in 2023: housing prices continue to rise both on the secondary market and for new buildings in almost all regions, and at the same time the number of transactions is decreasing due to economic uncertainty. At the same time, we continue to observe growth in the Euribor index, to which the floating mortgage rates of all commercial banks in Spain are tied. As a result, banks regularly review and increase their rates, not only floating, but also fixed.<\/p>\n

Many financial analysts predict the index to grow until the end of 2023 (to 4.00-4.50%) and its subsequent rollback by December 2024 (to 2.20-3.70%). In reality, the behavior of the index will directly depend on the level of inflation in the Eurozone. Today, for 2023, the most optimistic and most pessimistic forecasts speak of 5.00 and 6.80% inflation, for 2024 – 2.50 and 3.40%, and for 2025 – 2.20%.<\/p>\n

In the current conditions, the demand for mortgage in Spain<\/a> is decreasing, but this decrease cannot be called significant. Mortgage continues to be one of the most popular and popular banking products. For many clients, a mortgage loan is the only opportunity to acquire their own home (and most often, a mortgage is taken out specifically for the purchase of a first primary home by young families). Since 2022, the demand for mortgages with a fixed interest rate, which serves as a guarantee of stability for the entire term of the loan, has been growing.<\/p>\n

If you are planning to take out a mortgage in Spain in 2023, check out the current conditions and rates of leading commercial banks. Spanish banks, on the one hand, impose increasingly strict and stringent requirements on borrowers every year, but on the other hand, they offer all sorts of bonus programs that reward loyal customers or are aimed at young people. In any case, the choice of mortgage loans on the banking market is large, and each client can choose the most suitable conditions for themselves. Also, do not forget that banks are commercial structures with which you can negotiate, bargain and defend your own interests. With the greatest desire, Spanish banks encourage loyalty: the purchase or acquisition of additional financial products, linking to an income and expense account, brokerage activity, etc.<\/p>\n

Mortgage in Spain in 2023: which bank to choose?<\/h2>\n

If bank real estate is purchased, then in the vast majority of cases the mortgage is issued in the bank on whose balance sheet the property is located. In all other cases, the borrower is free to choose a bank at his own discretion.<\/p>\n

In Spain, in addition to traditional banks with the offices we are all familiar with, there are many online banks that are full-fledged market participants. You can often find low mortgage rates in online banks. The main inconvenience is that all negotiations, discussions and correspondence will have to be conducted virtually, which is not entirely convenient.<\/p>\n

Also, the borrower retains the right at any time in the case of an existing mortgage loan to change the borrowing bank and go to another, requesting subrogation of the mortgage. Such disloyal behavior entails the collection of a commission in favor of the original bank in the amount of 0.15% of the outstanding amount of the debt, but only in the first three years of the loan. Starting from the fourth year, switching to another bank does not involve any penalties or commissions. However, it should be remembered that a new mortgage agreement will need to be concluded with the new bank, which will entail additional costs (for example, opening a credit line, obtaining a new opinion from an independent appraiser on the market price of the property, etc.).<\/p>\n

Conditions for obtaining a minimum interest rate<\/h2>\n

Each commercial bank in Spain offers its own system of benefits and incentives that reduce the interest rate. The total amount of benefits may exceed 1%. All these benefits are bonuses for customer loyalty.<\/p>\n

Since 2019, Spain has had a new mortgage law that directly prohibits banks from imposing any financial products on their borrower clients and including onerous conditions in mortgage contracts. Banks decided that if a product cannot be imposed, then it is worth taking a different route and encouraging its purchase. Thus, banks today reduce the interest rate for any additional service or product. The list of services\/products includes: use of a debit and\/or credit card, linking income and expenses to an account (salaries, pensions, other payments, utility bills, taxes, etc.), participation in private pension or investment plans of a specific bank, registration of insurance through a bank and much more. It is not necessary to purchase the entire package of services if you do not need it, because… bonuses are calculated separately. But it is worth remembering that the right to bonuses is lost as soon as the service or product is abandoned.<\/p>\n

Bank commissions and costs for obtaining a mortgage in Spain in 2023<\/h2>\n

Virtually no Spanish banks currently charge mortgage processing fees. However, commissions are charged for early repayment of the loan, and their amount is fixed at the legislative level:<\/p>\n

For an adjustable rate mortgage:<\/strong><\/p>\n

– During the first 3 years of the loan – 0.25% of the balance of the debt, or, if both parties agree, during the first 5 years of the loan – 0.15%;
\n– From the 4th or 6th year \u2013 0%.<\/p>\n

For a fixed rate mortgage:<\/strong><\/p>\n

– During the first 10 years \u2013 2.00%;
\n– From the 11th year \u2013 1.50%.<\/p>\n

As for the costs of obtaining a mortgage in Spain in 2023, the borrower will only have to pay for the services of an independent appraiser, who must prepare an opinion on the market value of the property, as well as pay for his copy of the mortgage agreement. All other expenses are borne by the bank:<\/p>\n