Forms of financing your Home

non resident tax

Banks have traditionally been the entities in charge of facing the need for financing, but with the economic crisis of recent years, the entities have considerably tightened the conditions for accessing their products. Nowadays, although they are beginning to relax, some payment guarantees are still required to lend money such as guarantees with properties, high income or that other people (guarantors) can pay in case the holder of the loan did not have enough capital.

Whether you are a resident or a non-resident in Spain, credit institutions may grant a mortgage loan without major problems, but it must be borne in mind that granting a loan to one and the other may be different.

It may happen that the interest rates to be paid by a non-resident are higher than a resident, and this seems to be due to the fact that non-residents allocate “financing to the acquisition of a second home and have more difficulties in comply with some links that could subsidize the mortgage, such as direct debit of payroll or life insurance ", as some experts point out.

The financial documentation that non-residents must show to the bank is the same that is required of residents: employment contract, payroll, tax declaration and working life. A non-resident citizen is also often required to have a recent credit report on their economic behavior in the country where they live and work.

All documentation must be translated. Some banks also request the Hague Apostille. in order to certify the authenticity of the signature. It can be sent by email to study for the bank, but for the signing of the contract the presence of the interested party or a duly empowered third party is required.


 If the non-resident citizen who makes the purchase is a foreigner, to carry out operations with fiscal significance such as the purchase of a home, you must also request a NIE (foreigner's identification number) at a police station in Spain, or at an embassy or Spanish consulate.

The new mortgage law, in force since June 16, 2019, establishes innovations in almost all points of a mortgage: amortization commissions are limited, it is specified who should pay the expenses related to the constitution of the mortgage loan and conditions tighten so that a bank can initiate eviction procedures.

The main developments of the mortgage law are the following:

-          Publicity and financial solvency: the law establishes that publicity must indicate the interest rate, the total amount of the loan, the expenses included, the installment payments and the obligation to take out insurance or not. If the client is satisfied and decides to request a mortgage, the entity must thoroughly evaluate its economic situation.

The bank can only grant the credit if the creditworthiness assessment indicates that the customer is likely to pay. After all this, the bank can deny the mortgage. If it does, it will have to inform "in writing and without delay" to the consumer and its guarantor, if it has one, and motivate why.

-          If the financial entity is determined to grant the loan, it must give the client several documents at least ten calendar days before the contract is signed.

-          The law also requires the consumer to be advised that they must receive free personalized advice from the notary they choose. The bank must send to the notary the documentation delivered to the lender together with a statement signed by him in which he declares that he does indeed have it and that it has been explained to him.

It would be necessary to go to the notary twice, once in order to carry out an informative session, and once at the time of signing the deed.

Our law firm will be happy to help you to analyze your specific situation, apply for the appropriate licenses for you. If you are interested or have specific questions on the subject, we will be happy to assist you by email or phone.




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