In Spain there are numerous autonomous areas, each with their own regional governments, so it will be difficult to information each and every circumstance varying from Valencia to Bilbao, Barcelona to Seville, but this short article will try to give an in-depth overview of the general scenario, rather than a gloss-over of the main points.
Maybe the first point to mention is that in Spain there are two primary monetary entities that you can apply for a mortgage from. These entities are in some cases simpler to get a mortgage from, although conditions can often be simpler controlled to the favour of the caja, rather than those guidelines carefully set down by the Banco de España.
It's extremely common in Spain for an interest rate to be applied to your loan amount on a yearly basis, with a modification each calendar year, around the very same date as you sign your home mortgage. This implies that although interest rates may fluctuate, as they tend to do, then if you happen to sign your mortgage in the "highest peak" of interest, then you will pay that quantity of interest for the whole year - even if interest rates go down. Home loan "trackers" working on a month to moth basis, known across the world, are unknown in Spain.
Just to make things more complex, there are then 2 various types of indexes your bank or building society can chose to employ concerning your policy. The Euribor is the European Rates of interest, although it deserves keeping in mind that within the Eurobor, there is a different (always higher) Euribor Home mortgage rate.
The 2nd Rates of interest that might be applied is the more stable IRPH, which takes approximately the previous 4 months Euribor then determines the rate by doing this. Any loan from a bank or building society will charge the client (that's you) one of these two rates, plus anywhere in between 1-3%, depending on the risk, size of the residential or commercial property, readily available guarantors, etc. (keep in mind, my example here is for very first time buyers).
Any loan from either entity normally has a 1% opening fee on the net price, and the very same for any cancellation before the time of the loan expires - loans are generally given for Thirty Years, although in the last few years, specific banks have offered loans of up to 50 years, or those which will be acquired by next of kin/offspring. more info This implies that swapping and altering home loans over banks is practically impossible in Spain, given the costs included. A 1% cancellation cost in one bank followed by a 1% opening charge in the second (even if this is waived) indicates that there needs to be a considerable conserving on the general conditions offered by another entity for it to be rewarding considering. It nearly becomes a stock market video game, playing the possibilities of the possible increase in inflation - something that few people saw coming in the latter part of 2008.
Perhaps the very first point to mention is that in Spain there are 2 main financial entities that you can use for a mortgage from. It's exceptionally common in Spain for an interest rate to be used to your loan amount on a yearly basis, with a revision each calendar year, around the same date as you sign your home mortgage. This indicates that although interest rates may vary, as they tend to do, then if you occur to sign your home mortgage in the "highest peak" of interest, then you will pay that quantity of interest for the entire year - even if interest rates go down. Home mortgage "trackers" working on a month to moth basis, known throughout the world, are unknown in Spain.