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Can you use a mortgage in the UK to buy a flat in Spain?

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Can you use a mortgage in the UK to buy a flat in Spain?

Buying a property in Spain and making the move for a new life in the sun is a dream for many. And after this recent period of chaos, it is one that might be even more appealing than normal. Leaving the rat race behind, buying a flat or house near the beach - or with a pool - and spending a few years soaking up the sun and enjoying the slower and more relaxed place of life. It sounds nice, doesn’t it? Or perhaps you are looking to buy something as a holiday home – a place to go a few weeks a year to let off steam and rent out the rest of the time. 

The good news is that property in Spain is much cheaper than in the UK. This does vary depending on your exact destination, but generally your cash will go a lot further. However, unless you are a cash buyer then you will need to arrange some kind of finance, usually in the form or a mortgage or a loan.

The bad news is that there are currently no UK lenders offering mortgages for properties in Spain. But that doesn’t mean that the dream is over. There are other ways and means to secure funding for your Spanish dream. 

How to get a mortgage for a Spanish property 

There are a few financing options available for property in Spain. The first is to use a Spanish lender. You may require a larger deposit than normal and because Spanish banks don’t have automatic access to your credit rating, the process can take much longer. But there are a number of lenders who will give you a mortgage if you meet the criteria. 

There are also several non-Spanish international lenders who may be able to give you a mortgage. Banks based in Monaco, Switzerland and Luxembourg do offer international mortgages but these are usually for properties at the higher end of the market – generally between €1 and €2 million. 

The last option is perhaps the most suitable for most people. This involves raising capital on a property you already own. This could involve re-mortgaging a property in the UK and using these funds to make a purchase abroad in cash. However, before you make any hasty decisions, it is worth talking to a broker or thinking carefully about your finances. 

Getting a mortgage for a Spanish property: the details

Unless you are a cash buyer then you will need to secure some funding. Since you will be unable to get a mortgage for a Spanish property from a UK bank, then your options are to try and source one in Spain itself. This can be a daunting prospect but it doesn’t have to be. 

Yes, it is true that banks in Spain have different lending conditions and do not always offer the same conditions to clients, even if they have similar profiles. In Spain, as with so much of life, it is all about having the right contacts if you want to get the best deals. 

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