For the most part those who buy property in Spain use it as a vacation home, staying there part of the year. The rest of the year they may rent it out to those who would like to visit the area as a way to assist in payment of the mortgage on the property.
What to Know as You Consider Purchasing a Spanish Property
Don't trust this purchase to just anyone. When you search for the right real estate agent to work with, make sure they are reputable, registered, and experienced. Unfortunately there are some dishonest real estate agents out there that are looking for foreigners to take money from in real estate ventures. They hope the person looking to buy does not understand the Spanish real estate laws and that they can take advantage of that. A good way to be able to defend yourself is to speak Spanish so you can understand what is being said in deals and communicate more clearly in the purchasing process.
You should never purchase a property without conferring with a lawyer. The lawyer will go over all the details of a contract and mortgage to make sure everything is in your best interest. You should look for a Spanish lawyer who will also be familiar with Spanish real estate laws.
You should also pick your own lawyer. Many real estate agents will recommend a lawyer they know. But that person may be working for the real estate agents best interests, not yours.
Mortgaging a Property in Spain
Chances are when you decide to make a property purchase in Spain you are going to need a mortgage to pay for the property over time. There are quite a few mortgage types that are available in Spain. You should look through them all to decide which one is the best for your situation.
First is an International Mortgage. This is a mortgage you can take in your home country to buy the property in Spain. You will likely have to look for a larger mortgage company to finance this transaction. Most mortgage companies will allow you to take this kind of mortgage if you already own a home in your country and are purchasing a second home. Normally, the allowance is for 70 percent financing with a 30 percent down payment.
The other mortgage option is a second mortgage. If you have a lot of equity in your first home, this may be the best option for purchasing a vacation home in Spain. In this type of mortgage you will finance your vacation home using your primary home as collateral in the purchase. Before you enter into this type of mortgage you should make sure you will be able to afford the payment on the home and don't forget about interest and taxes that you will be expected to pay.
