Mortgage application process Spain

When is a mortgage offer not an offer

Whilst the application process for a Mortgage in Spain closely resembles that of other countries the process of pre-approval can be confusing and lacks robustness.

Apart from one lender no Banks in Spain have sophisticated scoring systems that allow them to pre-approve loan by checking key parameters.

Scoring systems

Sabadell Bank who do have a scoring system which allows for quick responses on what it is likely they can offer do not however use this scoring system in the way in which a UK lender might and an applicant used to pre-approvals from other countries should proceed with caution when they are told they are approved and on what basis.

In Spain only fully packaged applications that have been passed to and reviewed by the Risk Teams at either regional or national level are deemed to be fiscally approved. Any other information however official it may appear given at branch level is just an illustration of what could be posible and is not in any way shape or form an approval to lending.

Valuation first

Many Banks in Spain will not pass to their underwriting teams a documented application for fiscal approval until a valuation is paid for and the result is back to be added to the file. This can mean a valuation fee must be paid before an applicant even knows if they are personally approved and meet bank criteria.

Avoid the pitfalls

Most Banks, if you insist on it or are using an experienced broker will provide, without valuation a fully underwritten approval to lend but just because documents have been submitted do not assume it has been seen by Risk. Often branch staff will just review the file and state that they see no problems.

Language barriers and a miss-understandings over how far in the process the application is can cause confusion.

Read the full article :- Applying for a Mortgage in Spain