Mortgage in Spain for non-residents: what banks ask for

You can, but budget more time

You don't need to be a resident to take out a mortgage on a property in the Canary Islands: the law on mortgage credit contracts protects the borrower the same way regardless, and the timings are set out in writing. What changes, from the clients I work with, is the sheer volume of paperwork that arrives from abroad. My advice: open the file before the arras, not after.

What the bank looks at

The Banco de España puts it plainly: the bank carries out a feasibility study to work out your ability to pay, and checks your current and foreseeable income, assets, expenses and existing commitments. It checks the CIRBE, the central credit register, and the registers of unpaid debts. A tasación of the security is also carried out, but your solvency isn't judged mainly on the value of that security.

On how much they'll lend you against the appraisal value there's no official figure, and that's exactly why I don't write one: Spanish notaries say only that banks have limits beyond a certain percentage of the tasación value. That percentage is declared by each individual bank in the FEIN.

The tasación

The valuation has to be carried out by a tasación company independent of the bank, and you pay for it. Since you're the one paying, you're entitled to a copy, and to the original if the mortgage doesn't go ahead. You can also bring your own, as long as it's certified by an accredited valuer and hasn't expired: the bank has to accept it, without charging you for checking it.

The ten days: FEIN, FiAE and the notary

• At least ten days before signing, the bank hands you the FEIN, the Ficha Europea de Información Normalizada, which counts as a binding offer, and the FiAE, the form listing the sensitive clauses.
• With the same notice come a copy of the draft contract, a simulation of the repayments under different rate scenarios if the mortgage is variable, the insurance conditions and the breakdown of costs.
• In those days you go to a notary you choose yourself, on your own, without the bank. They explain the loan to you, test your understanding of it and draw up a deed: that deed costs nothing, and without it the mortgage escritura can't be authorised.

It's the part of the Spanish process I like best, and the one no foreign client expects. Turn up with your questions written down: it's the only moment when you have a professional in front of you who's paid not to sell you anything.

Who pays for what

On the mortgage itself, the split is set by law: you pay for the tasación, the bank covers the notary, the registry, the taxes and the gestoría. The costs of the purchase itself are a separate matter, covered in the buying guide.

This is general guidance, not financial or legal advice. Every bank has its own conditions: get a qualified professional to advise you before you sign anything.