Now that the purchase contract is taken care of – your money is no longer at risk should the banks let you down at the last moment.
Now what? Well now you need to find that mortgage. There are lots of banks in Spain and Tenerife offering mortgages to non-residents so how do you know which one to choose? The difference between one type of mortgage and another can literally double the amount of money it costs you to purchase your property. Amazing but true.
Bear in mind that there are the legal fees and taxes to be paid in addition to the sum not covered by the mortgage. So on a purchase of 200,000 Euros for example, the additional costs add up to 20,000 Euros.
If you are offered a 70% mortgage (140,000 Euros) you need to find the difference (60,000 Euros) plus the costs (20,000 Euros) which totals 80,000 Euros cash.
A 70% mortgage is quite typical in Spain although more is sometimes achievable. generally speaking though, the more you want to borrow, the more interest the banks will charge you so if you don´t need that extra 10% – don´t take it.
Working with someone who has lots of experience in brokering mortgages here in Tenerife could save you a small fortune and keep you safe throughout the purchase. I still broker the entire Spanish mortgage market for all of my clients and am fully up to date on products, features, criteria etc. I don´t know any other agencies here that can still do this and very lilely they will take you to any old bank, tell you they know the manager (makes no difference…) and cross their fingers.