7 Basics every home buyer should know
22 March, 2023 | Antonio Beltrán
Are you willing to buy a house in Spain to settle down or as a second residence to enjoy your holidays? Remember to know beforehand how does this mortgage world works in Spain. You should be aware of some basic things to get the best house of all houses. And in this article we will give you the best 7 tricks to buy a house in the perfect conditions and with the maximum benefit for yourself.
Our team of Hipotecasplus has been working in the field of houses and mortgages for a lot of years, so we are able to perfectly connect buyers and lenders in order to give them the best possible options. In a word, we are the ones that will build the bridge between you and your bank, so you can find your perfect house with your perfect mortgage and the best conditions according to your profile. So to say, depending on your personal needs and characteristics, we’ll search in the mortgage market until we find the best option for you.
Besides, as we have said, if you want to buy a house, there are some things you should be aware of. It is true what they say: knowledge is power! So, the more you know about the buying process, the more you’ll win with your new house. That’s why we have outlined 7 tips you must know if you are planning to purchase a house and want to save some time and money. Let’s see them!
1. Credit worthiness
If your current residence is not placed in Spain, you might need to prove to Spanish banks you have enough financial solvency to buy a second residence here for you and your family. The conditions that Spanish banks ask to non-resident customers are always stricter and more restrictive than those of the usual mortgages.
Therefore, you must be prepared to assume high extra expenses, as well as to be able to present a series of documents that prove your solvency and economic stability. The reason? Bank entities need to have sufficient economic confidence with the client to give the green light to the mortgage.
In that sense, if you want to make sure you’ll be able to buy a certain house, you can use our online calculator. It is completely free and in only a few seconds you’ll know if you have credit worthiness or not.
Talking about savings, they are key in terms of mortgages. If you are willing to buy a new house, it is indispensable to have some money saved beforehand. As Bank of Spain suggests, the ideal is to have more than the 30% of the purchase value of the house. By this way, you will be able to properly face the main mortgage expenses and reduce the total amount you’ll have to pay on mortgage.
3. Rate interests
Depending on your type of mortgage and your chosen bank entity, you’ll have different rate interests and taxes. In a basic overview, which you should definitely know is that there are two maily types of interest rates:
- Fixed rates. The interest rate in this type of mortgages will not change during the total amount of years you will be paying back your house. In a word, it is always going to be the same, no matter market fluctuation or economic crisis. However, their stability usually entails a higher interest rate than the variable ones.
- Variable rates. Those are the interest rates that vary from one year to the next one, depending on market fluctuations. Usually associated with Euribor, if it goes down, so your mortgage. But if it goes up, so does your mortgage. At this point, you might have guessed it is quite unpredictable and you’ll always depend on the economic market. The good part is that they are usually quite lower than the fixed ones.
4. Down payment requirements
Each bank entity has different down payment requirements (briefly, the upfront cash you pay toward the home purchase). So, depending on the house, the location, and the bank you ask for a mortgage, the down payment will be one or another. Make sure you choose the one you can truly afford and that will not run out all your savings!
5. Importance of income
The total amount of money you receive on a regular basis, such as salary or income for investments, is the first thing banks will ask for before giving you any mortgage offer. As a result, it is basic to have a good income in order to get a good house and a good mortgage. Nevertheless, do not worry, because from Hipotecasplus we will negotiate with your bank entity and will try to obtain the best mortgage possible according to your personal needs and characteristics.
6. Other costs
Furthermore, it is important to understand there are other costs involved when buying a new house. The thing is not only about mortgage payments, but about property taxes and homeower’s insurance, among others. In that sense, make sure you are aware of all these “extra costs” you’ll need to face. And, if you have a doubt regarding this, do not hesitate to contact Hipotecasplus for further information!
7. Find a good broker
Hipotecasplus is a mortgage broker that will guide you during all the process: from the first moment to the last, when you finally get your new house keys. In this sense, it is a good idea to benefit from the help of someone who is a specialist in this field, so you do not feel too lost. Especially if you are from a foreign country, it is key to have an expert like us who can guide you and give you advice about mortgages in Spain.
Now you know: get in touch with Hipotecasplus and we’ll help you with everything you need as soon as possible. And, the best of all: no commitment is required! We’ll be more than happy to help you finding your best house in Spain!