Mortgage levels down in Cataluna

Impact of Cataluna Independence

Whilst pre the referendum held in Cataluna August Spanish mortgage data showed the region falling behind the upturn seen in other regions of Spain.

Mortgages in Spain rose month on month above July figures except for Cataluna who saw a fall.

Whilst the region remains up year on year and August 2017 figures were still above those of august 2016 there was a marked difference in the performance when compared to the rest of Spain.

Interest rates fall

Interest rates as an average continued to fall for both variable rate products and fixed rates. Fixed rates are down significantly on last year and the percentage of Spanish loan applications opting for a fixed rate has increased by over 50% in the last 12 months.

The data includes changes to existing contracts and the Spanish Banks have been moving clients with floor rates to fixed rates so this has also had an impact.

Numbers of new loans

Numbers of new loans increased both year on year and month on month but the average loan size whilst above last years dropped against July to the point where slightly less capital was lent in the month.

Whilst not yet a trend August saw another month where outflows were exceeded by new business added which is good news for the Spanish Banks.

Read the full article:- Lending up nationally Cataluna sees a drop

American loan applicants in Spain

American buyers

American buyers in Spain can expect favourable terms and conditions from Spanish Banks in comparison to other non EU citizens.

This is because the processes for documenting taxed incomes, recording of debt performance in the US is very clear and transparent and robust.

Other countries where this is not the case struggle to obtain the same terms and conditions offered to those residing in Europe.

Product availability

Maximum loan to value in Spain will be 70%. This is restricted because the property is a second home rather than primary residence.

If the applicant intends to live and pay income taxes in Spain after a sustained and prolonged period of time in the Spanish system a further 10% may be able to be borrowed.

Product types are not sophisticated as they are in America and no interest only is granted.

Loans are repayment either variable trackers of fixed rates foxed for the full term.

Application process

It is possible before coming to Spain to view property to get in place a fiscal approval. This requires a fully documented application is made to the lender and is underwritten by the risk teams subject to valuation of a property.

The securitization process in Spain is very different to the US as are the legal obligations and there is a lack of flexibility after completion in terms of changing product or lender so it is always best to take independent and expert advice from a mortgage broker before committing yourself.

Read the full article :- Mortgages in Spain for Americans