Mortgages in Spain increase in May and House sales are up

Notaries in Spain

The Notaries council called Consejo General del Notariado publihsed last week the high level data for Mays mortgage completions and house sales in Spain.

Mortgage levels were up by 26.4% year on year and the average loan size rose 6%.

In total 14,213 new loans were granted.

House sales continued to rise up 8.4% but the average price continued to drop slightly.

Annually mortgages are now up 11.5% in 2015 over 2014 and the average loan amount has increased by 3.6%.

Spanish Banks

For the first 6 months of 2015 the Spanish Banks have continued to more aggresivley lend.

This desire to secure more mortgages has helped improve the terms and conditions not just for Spanish residents but also for non resident buyers.

Whilst variable rate remains the most widely offered option more and more lenders have looked to offer long term fixed rates allowing applicants to tie themsleves into competitive long term rates covering the whole of the mortgage term.

Fixed rates can be offered from as low as 1.99% for 20 years but as with all Spanish Loans a number of linked products have to be taken with the lender to secure the lowest possible rate. Direct bank staff are not always as good as they could be at explaining this preferring to focus on headline rates rather than the nitty gritty of obatining them.

Lending Criteria

Criterias continue to be maintained with lenders looking for mortgage applications to demonstrate the borrower is not utilizing in general more than 35% of their proven net incomes for the purpose of debt payments.

Borrowers who are company onwers and do not draw all the income they could each year still have some issues getting Spanish Banks to accept the higher possible incomes rather than those incomes shown on personal tax returns.

More and more lenders are willing to look at 70% loan to value rather than the more standard 60% but many will only do so on a case by case basis for those mortgages they deem to be of more significance to them, and from applicants who meet criteria easily.

Read the full article :-Mortgages in Spain 2015 market update