Mortgage in Tenerife

Mortgages in Tenerife are a popular and inexpensive way to buy your dream home or to invest in real estate.

There are no restrictions for foreign citizens. You can apply for a mortgage in many banks. The terms of lending and the package of documents are approximately the same.

Mortgage lending conditions for non-residents of Spain

• 1.7 – 3.0% per annum, first year

From the second year onwards, Euribor is added to the base interest rate. For the last few years, the Euribor rate (the European refinancing rate) has been below zero.

Fixed percentage 2.5 – 3.0%, depends on:

• Down payment. The higher the percentage of your own money, the lower the interest rate
• Loan term
• Client profile, salary size, credit history

The loan amount is up to 60%.
That is, the first payment should be from 40% for regular housing.
Bank fees and products, on average 2000 euros.

The interest rate and loan terms may be more favorable if you buy real estate from a bank.
It is important that the amount of your monthly mortgage payments does not exceed 35% of your monthly income.

In order to make a positive decision on granting you a mortgage loan, you must prepare all the required documents and translate them into Spanish.
Translation of documents must be certified by the seal of the translation agency.

When a mortgage loan is approved, the following amounts are added:

— Bank commission for providing a loan – 1.5 — 2 % of the issued amount.

— Evaluation of the object by an independent appraiser is approximately 0.02% of the cost. On average, this is 350-450 euros depending on the area of the object.

— Notary fee for the second notarial act (which confirms the buyer’s relationship with the borrowing bank)
– 800 — 1000 euros.

— Insurance of the property against all risks (mandatory condition of the borrowing bank) – from 150 to 400 euros per year, depending on the property.

— Registration of the mortgage agreement — Gestion Escritura — 0.02% of the value of the property.

— Other bank products

As we wrote earlier, everything is simple, with a mortgage the total investment amount increases by approximately 12% from the cost of housing