Mortgages for non-residents: requirements and conditions

discover how to buy a home and secure a mortgage in spain—even if you don’t live here. we explain how to apply for a non-resident mortgage and highlight the key points you need to know to find the loan that fits your needs.

who can apply for a non-resident mortgage in spain?

spain has become a top destination for home buyers. in 2023, foreign buyers made up 15% of property transactions. imagine enjoying the mediterranean climate and owning your own house in spain—maybe even in beautiful mallorca!

if you’re wondering, “can i get a mortgage in spain if i’m not a resident?” the answer is yes. but first, let’s cover some important details.

are you in spain for more than 183 days a year?
- if yes, you’re considered a resident—even if you were born abroad.
- if no, you’re a non-resident. read on to see what you need to qualify.

requirements for non-resident mortgages

to secure a mortgage in spain as a non-resident, you must apply through a spanish bank and meet these conditions:

• nie:
  you need a nie (foreigner identification number) to buy a home in spain—whether with or without a mortgage. if you don’t have one, check out how to get it (or ask a lawyer for help). if you’re spanish but live abroad, your dni will suffice.

• residence:
  banks typically approve non-resident mortgages for citizens from countries with strong currencies (such as the usa, uk, switzerland, or other eurozone countries). if you come from a country with an unstable currency or ongoing conflicts, getting approved might be more challenging.

• age:
  you must be at least 18. most banks require that your mortgage is fully paid off by the time you reach 75, though some extend the term to 80.

• savings and income:
  you’ll usually need to cover about 40% of the home’s price with your savings—30% for the part not financed by the bank and an extra 10% for associated expenses and taxes. yes, in spain you might pay around 10% just to buy a house!

• stability and payment capacity:
  you must demonstrate steady and sufficient income so that your mortgage, plus any other debts, doesn’t exceed about 30% of your income.

how do non-resident mortgages work?

if you meet the requirements, here are a few key points about spain’s mortgage system:

• interest rates:
  spain offers three types:
• fixed-rate: your interest stays the same and so does your monthly payment.
• variable-rate: your interest fluctuates with the euribor. if the euribor rises, so will your payment; if it falls, you pay less.
• mixed: fixed for the first few years (usually 3 to 15), then variable.

try our spanischerhypothekenrechner.com tool to see which option suits you best.

• amortization:
  spain uses the french amortization system—initially, you pay more interest than principal, but over time, more of your payment goes toward the loan.

• valuation:
  an appraiser will visit the property to assess its value, which may be equal to, lower, or higher than the purchase price.

• financing percentage:
  as a non-resident, banks typically finance up to 70% of the lower value between the appraisal and the sale price. for example, if a home costs 200,000 euros but is appraised at 190,000, you might get up to 140,000 euros financed.

• linked products:
  many banks will ask you to purchase additional products (like life or home insurance) to offer you a better rate. while life insurance is optional in spain, you must have a damages insurance (a simpler version of home insurance) that you can get from any provider.

• term:
  you can usually repay your non-resident mortgage over 20 years, though some banks offer up to 30 years.

• commissions:
  some banks charge an opening fee (around 0.5% of the loan amount) and may charge an early repayment fee if you cancel your mortgage before the term ends—this fee is often higher for fixed-rate mortgages than for variable ones.

• currency:
  mortgages are provided in euros. however, spain’s law allows you to convert your mortgage into the currency in which you receive your income, saving you from monthly conversion hassles.

taxes and extra costs when buying in spain

buying a home in spain comes with several taxes and fees:

if buying a resale property:
- property transfer tax: ranges between 6% and 10% of the higher value between the sale price and the cadastral value.

if buying new:
- iva: new homes come with a 10% vat (or 6.5% in canarias).
- documented legal acts tax (ajd): typically between 0.5% and 1.5% of the higher value between the sale price and the cadastral value.

plus, you’ll pay for notary fees, administrative costs (around 300 euros), and property registry fees.

annual taxes include:
- non-resident income tax (irnr): if you don’t rent out the property, this tax is based on a notional rental income (usually 1.1% to 2% of the cadastral value). if you rent it, the tax is based on the rental income. rates are around 24% for non-eu residents and 19% for eu residents. - property tax (ibi): an annual tax based on the property’s location and cadastral value. - wealth tax: in some regions, if your spain-based assets exceed 700,000 euros, you may be subject to this tax.

common mistakes to avoid

when applying for a non-resident mortgage, steer clear of these pitfalls:

• not having your nie ready:
  start the process only after you know how to obtain your nie—it can save you a lot of hassle.

• ignoring exchange rates:
  if your income isn’t in euros, fluctuations in the exchange rate could increase your overall costs. plan ahead.

• settling for the first offer:
  the market for non-resident mortgages in spain is competitive. compare different offers—try spanischerhypothekenrechner.com to check various rates and fees.

• skipping local legal advice:
  spain’s property laws can be complex for foreigners. get advice from a local lawyer to avoid potential legal issues.

a practical example

imagine buying a house in malaga for 300,000 euros with a non-resident mortgage. here’s a quick example:

• fixed mortgage: interest at 3.10%
• variable mortgage: euribor + 0.20%

this is just an example. for a detailed calculation, try spanischerhypothekenrechner.com and see what fits your situation.

which banks offer non-resident mortgages?

several spanish banks offer non-resident mortgages—from online lenders like hipotecas.com to traditional banks such as banco sabadell, banco santander, caixabank, abanca, and bankinter. the best conditions change with the market, so compare several options—either by visiting branches in spain (if you can spend a few weeks there) or by consulting a mortgage broker who specializes in spanish mortgages.

if traveling isn’t an option, a professional broker can help you navigate the offers and process.

final tips

buying a home in spain—especially in mallorca—can be an exciting opportunity, but don’t overlook these details:

• ensure your nie is ready before starting the process.
• keep an eye on the exchange rate if your income isn’t in euros.
• compare multiple offers to get the best deal.
• seek local legal advice to avoid any complications.

with the right preparation, your dream of owning a home in spain can become a reality.

feel free to try spanischerhypothekenrechner.com for personalized calculations and more options. enjoy your journey to owning a piece of spain!