One important financial decision is choosing a mortgage to buy property in Spain. Buying a flat is the most expensive purchase for many families, therefore getting it right is crucial.
According to property website Fotocasa’s recent report, 68% of purchases during 2023’s first quarter needed mortgage financing. That is, 7 out of 10 Spaniards still need mortgages to buy property. And we are mortgage management experts at Tecnotramit. That is why we give you some advice in this post to help you get it right.
1. Understand your financial needs: Before searching for a mortgage, assess your financial situation, income, expenses, and how much you can afford to pay each month. This will help you determine the type of mortgage that best suits your needs.
2. Compare offers: Don’t restrict yourself by accepting the first offer you receive. Compare different financial institution’s conditions, interest rates, instalments, and costs. Use online comparators or check with mortgage advisers.
3. Interest rates: Interest rates are crucial, specially in today’s economic context. You can choose either fixed, variable, or mixed rate mortgages. Make sure you understand the implications for each option and choose the one that best suits your risk tolerance.
4. Mortgage life: The life of a mortgage will affect monthly payments. A shorter life normally leads to lower interest rates, but higher payments; a longer term mortgage reduces monthly payments, yet increases the overall mortgage cost in the long-run. Choose a life span you can manage financially.
5. Flexibility: Look for a mortgage that offers flexibility, such as possibly paying additional instalments or cancelling beforehand without being penalised. This will help you reduce your overall mortgage cost.
6. Demand transparency and assess customer service: Make sure the financial institution provides you with clear and detailed information about mortgage conditions. Ask about any expression you do not understand. In addition, working with an institution that offers good customer service can ease the process and clarify questions effectively.
7. Professional advice: Last but not least, professional services from a mortgage adviser or lawyer specialised in mortgages are key to understanding mortgage contract terms and conditions fully and making the right decision before signing any documents.