Mortgages for Expats in Spain: LTVs, Rates & Documentation

Table of contents

• How Spanish mortgages work for expats
• Loan-to-value ratios and affordability rules
• Fixed vs variable rates in 2025
• Key lenders and what they offer
• Documents you’ll need
• Step-by-step mortgage timeline
• Understanding the valuation (tasación)
• Insurance and ancillary products
• After approval: signing at the notary
• Managing your mortgage after completion
• FAQs

How Spanish mortgages work for expats

Spanish banks finance property purchases for both residents and non-residents, but lending criteria differ. Non-resident borrowers typically secure lower loan-to-value ratios and must document international income. Banks evaluate debt-to-income ratios, currency exposure, and property type before issuing offers. Mortgage offers are valid for 30–90 days and include a binding offer (FEIN) and standard pre-contractual information (FIAE). Spanish law requires a 10-day cooling-off period before signing the mortgage deed to ensure you understand the terms.

Loan-to-value ratios and affordability rules

• Non-residents: 50–60% LTV on second homes. Some banks stretch to 70% for EU residents with strong profiles.
• Residents: Up to 80% LTV for primary residences and 70% for second homes. Residents must provide Spanish tax returns and employment contracts.
• Debt-to-income (DTI): Monthly mortgage payments plus existing debts should not exceed 30–35% of net income.
• Currency mismatch: If your income is in a different currency, banks may reduce the LTV or require hedging to manage exchange risk.

Prepare to contribute at least 40–50% of the purchase price plus transaction costs in cash when buying as a non-resident.

Fixed vs variable rates in 2025

Interest rates stabilised after the 2023 Euribor surge. In 2025:

• Fixed rates range from 3.2% to 4.0% for non-residents, offering payment certainty.
• Variable rates follow Euribor plus a margin (typically 1.0–1.5%). With Euribor hovering around 3%, expect total rates near 4–4.5%.
• Mixed mortgages combine a fixed period (5–10 years) with variable thereafter, balancing certainty and flexibility.

Choose based on your income currency, risk tolerance, and plans to hold the property long term. Many expats opt for fixed rates to mitigate currency fluctuations.

Key lenders and what they offer

• CaixaBank HolaBank. Tailored to international clients with multilingual support, fixed and variable options, and up to 70% LTV for EU residents.
• Banco Sabadell. Offers flexible mixed-rate mortgages and simplified processes for property developments.
• Bankinter. Competitive fixed rates and bridging finance for off-plan purchases.
• Santander International. Strength in UK and Latin American markets, with bundled insurance products.
• BBVA. Digital onboarding and cross-border support, though conservative on LTV.
• Ibercaja and Kutxabank. Regional banks with attractive rates for properties in their core areas.

Work with mortgage brokers or legal advisors to compare offers and negotiate terms. Banks consider overall relationship value, so transferring savings or investments may unlock better rates.

Documents you’ll need

Prepare a comprehensive dossier:

• Passports and NIE certificates for all borrowers.
• Proof of marital status (marriage certificate or divorce decree).
• Last two years of tax returns (or P60s for UK clients).
• Recent payslips or income statements.
• Employment letter confirming position, salary, and contract type.
• Bank statements for the last 6–12 months showing savings and existing loans.
• Credit reports from your home country.
• Documentation for existing mortgages or loans.
• Reservation contract or purchase agreement for the Spanish property.

Self-employed applicants supply company accounts, profit-and-loss statements, and accountant letters. Translate documents into Spanish if required by the bank.

Step-by-step mortgage timeline

1. Pre-qualification (Week 0). Share income figures with banks or brokers to gauge eligibility.
2. Document submission (Weeks 1–2). Send full documentation for underwriting.
3. Provisional offer (Weeks 2–4). The bank issues a conditional approval subject to valuation and compliance checks.
4. Valuation (Weeks 4–6). You pay for the valuation; the bank reviews the report.
5. Final offer and FEIN (Weeks 6–7). Receive binding terms and pre-contractual documents.
6. Cooling-off period (Week 7–8). Review documents with your lawyer and sign acceptance.
7. Notary signing (Week 8+). Sign the mortgage deed and purchase deed at the notary, typically on the same day.

Factor in longer timelines for complex income structures or when buying off-plan properties.

Understanding the valuation (tasación)

The valuation determines the property’s market value and influences the maximum loan amount. Key points:

• Conducted by an approved valuation company (sociedad de tasación).
• Costs €350–€600 depending on property size and location.
• The bank lends against the lower of the purchase price or valuation.
• Valid for six months; renew if the purchase timeline extends.

If the valuation is lower than expected, renegotiate the purchase price or prepare additional cash to cover the difference.

Insurance and ancillary products

Spanish banks often bundle insurance with mortgages:

• Home insurance. Mandatory to cover the property structure. You can choose any insurer, but banks may offer discounts if you use their policy.
• Life insurance. Frequently required for non-residents to mitigate risk. Premiums depend on age and health.
• Payment protection insurance. Optional but useful for self-employed borrowers.

Evaluate the total cost. Sometimes paying a slightly higher interest rate allows you to decline expensive insurance add-ons.

After approval: signing at the notary

The notary appointment includes:

1. Meeting with the notary at least one day before signing to review the FEIN and FIAE documents. This meeting is mandatory under Spanish mortgage law.
2. On signing day, executing both the purchase deed and mortgage deed. The bank representative attends to release funds.
3. Paying associated fees and taxes (AJD on the mortgage is paid by the bank since 2018 reforms, but check regional practices).
4. Receiving copies of the deeds and starting mortgage payments the following month.

Managing your mortgage after completion

• Set up direct debits from your Spanish bank account to avoid missed payments.
• Monitor interest rate reviews if you chose a variable or mixed mortgage.
• Consider early repayments. Spanish law allows partial repayments with capped fees (0.15% for fixed-rate loans after the first year).
• Keep insurance up to date and inform the bank of any policy changes.
• Track currency rates and consider forward contracts if paying from non-euro income.

FAQs

Can I refinance later?

Yes. You can subrogate your mortgage to another bank offering better terms or renegotiate with your existing bank. Fees apply but may be offset by savings.

Can I combine the mortgage with the Golden Visa?

Yes, as long as you invest at least €500,000 of your own funds. Any financing above that can be mortgaged. See our Golden Visa guide for details.

What happens if I sell the property?

You can redeem the mortgage at sale. Some banks charge small cancellation fees. Ensure the debt is cleared before signing the sale deed.

Do banks finance renovation costs?

Some offer renovation loans bundled with the mortgage, especially for energy-efficiency upgrades. Provide contractor quotes and work permits to access these options.

This guide is informational; get tailored advice by booking a call.