How to get a mortgage in Spain: a foreigner's guide to funding a property purchase

🎥 Watch the video below to hear Alex explain the essentials of getting a mortgage in Spain, and his top insider tips.

Can foreigners get a mortgage in Spain?

Yes – and according to Alex, your first step should be speaking to a mortgage broker rather than wandering into a bank at random. He says “my best advice would be to talk to an independent mortgage broker. Talk to them before you come out to Spain and start looking at properties.”

A broker will review your finances and tell you how much you can realistically borrow. This means you can set a sensible property search budget before you fall in love with that dreamy €600,000 villa you can’t afford. If you’re still on the fence about borrowing in Spain, here are 10 reasons a Spanish mortgage might be the smart choice.

How much can you borrow in Spain?

Alex says non-residents can usually borrow up to 70% of the property price, meaning you’ll need:

• 30% deposit to cover the rest
• Around 10% extra for buying costs (taxes, notary, land registry, and legal fees)

In other words, as a non-resident, you should budget for around 40% of the property price upfront.

If you become a Spanish resident for tax purposes, you may be able to borrow slightly more – up to around 80% loan-to-value (LTV). But for most international buyers, 70% is the realistic ceiling.

Example cost breakdown
Let’s say you’ve got your eye on a €250,000 apartment in Valencia:

• 70% mortgage = €175,000
• 30% deposit = €75,000
• Estimated 10% buying costs = €25,000

Total cash needed upfront: €100,000.

The mortgage step-by-step process

Here’s how the process usually unfolds for non-resident buyers:

1. Get an NIE (Número de Identidad de Extranjero)
You’ll need this foreign ID number to sign the mortgage deed. Apply in Spain, via a Spanish consulate, or give your lawyer power of attorney to handle it.

2. Open a Spanish bank account
Required for deposits, monthly mortgage payments, and handling the property transaction.  Read our guide to opening a Spanish bank account if you’re not sure where to start.

3. Secure a mortgage pre-approval
A broker can arrange an Agreement in Principle, which makes you nearly as attractive as a cash buyer.

4. Submit your financial documents
Expect to hand over income proof, tax returns, debt details, and copies of other assets or property deeds.

5. Bank valuation and approval
The bank orders a valuation by an approved surveyor. Your mortgage amount is based on this valuation, not just the purchase price.

Example: If your €250,000 property is valued at €240,000 and your LTV is 70%, the bank lends €168,000 (70% of €240,000), and you cover the shortfall in cash.

6. Cooling-off and completion
Spanish law requires a 10-day mortgage cooling-off period after you receive the official offer. After that, you can sign with the notary, the bank pays the seller, and you get the keys.

From start to finish, expect the process to take 6–8 weeks – faster if your documents are perfect and the valuation comes in as expected.

Documents you’ll need for a Spanish mortgage

Spanish lenders love paperwork. To get the ball rolling, you’ll typically need:

• Passport or national ID
• NIE certificate (you need it before signing the mortgage deed).  Read our guide to getting an NIE number for how to get yours quickly.
• 3–6 months of bank statements
• 2–3 years of tax returns or P60s
• Payslips or proof of self-employment income
• Details of existing loans or debts
• Property details, once chosen

Banks will also check your debt-to-income ratio, so be ready to show that your finances can comfortably cover the new mortgage payments.

Mortgage types and terms in Spain

Most Spanish mortgages are capital and repayment loans, where each payment reduces both the interest and principal.

• Typical term: 15–25 years (some banks offer up to 30 years for younger borrowers)
• Interest rates:
  • Variable rate mortgages (linked to the 12-month Euribor) are most common and flexible
  • Fixed rate mortgages give payment certainty but may limit overpayments
  • Interest-only mortgages are rare, usually reserved for very high-value properties or international lenders

If you earn in pounds or dollars, remember that currency swings can affect your payments. A currency buffer or transfer strategy is wise.

Why a Spanish mortgage?

Marc Elliott De Lama, founder of one of the truly independent mortgage brokers in the marketplace, Fluent Finance Abroad gives us his top 10 reasons why a Spanish mortgage might be the right decision when buying a property in Spain.

1. If your liquid funds are in a currency other than Euro, you could fund part of the purchase by getting a Euro Mortgage therefore offsetting any currency fluctuations when it comes to sending funds to Spain to cover deposit and costs.
2. You may feel that your cash budget doesn’t get you the property you really want so getting a Spanish mortgage can give you the right amount of cash so you can purchase your dream property in the location you desire.
3. If the property is for investment and you wish to receive a rental return, it is worth considering buying a better property in a more desirable location, as these types of properties are more likely to get you a better rental return on your investment.
4. Interest rates are some of the lowest in the EUROZONE, therefore our clients are taking advantage of these lower rates in order to make the most of their cash and using their liquidity for other important things or investments.
5. Raising mortgage finance against unencumbered Spanish properties is almost impossible and therefore Spanish properties are very illiquid, meaning that the property would normally have to be sold to release quick cash against it for any reason, apart from home improvements. There are specialised lenders which can do this type of lending but tend to be more expensive than the high street options who do not entertain this at all. We get many enquiries from old cash buyers desperate to release funds to sort issues out back home or invest in other projects or investments but come to realise that they should have bought with a mortgage in Spain and therefore not tying up their cash. It can take a long time to sell a property in Spain just like in any other country. Property is not a very liquid asset like bonds and shares because it cannot be sold within minutes. It can take several months.
6. The debt is against the asset in the country where the asset is held i.e. Spain. This is a good idea mainly because if there was an issue in your home country, the lending would remain in Spain and it would be difficult for the Spanish lender to raise a concern in the country where you are resident.
7. Spanish banks will do their own legal due diligence against the property meaning that if the bank will not lend against the property, it probably isn’t worth buying and it may even have legal issues such as not being properly registered. This offers you, the buyer, an extra layer of security when you purchase.
8. Short-term Spanish mortgages are available so you don’t have to be tied into a long term mortgage here. You can obtain a flexible mortgage meaning you can cancel the mortgage at any time without incurring heavy redemption penalties. A perfect example of this is if a client is expecting a lump sum in the near future (i.e. tax free pension lump sum or a sale of a property elsewhere or a bonus payment from your employer), the mortgage can be cancelled in full or part leaving no charge against the asset.
9. You may have the ability to purchase more than one Spanish property if you wish to create a small holiday letting portfolio here in Spain. Contact our team and we can advise you as the the best way to do this.
10. Age is not much of an issue as lenders in Spain are able to lend on pension income

Other ways to finance your purchase

Other than a Spanish mortgage here are 6 other ways to fund a property purchase in Spain

A cash purchase

You might have inherited money, have substantial savings or had a windfall you’d like to invest in overseas property. Cash buyers can also raise collateral by releasing equity from existing assets. In many Spanish regions, the average house prices are lower than in northern Europe, so you can sell to downsize your property, or even find something like for like in terms of floor space in Spain.

Pros

• This is a very quick way to make a purchase and could be used as a bargaining tool to negotiate a good price for your Spanish property.

Cons

• It’s still advisable to get all the valuations and legal checks a bank might carry out to ensure you’re making a safe investment. An independent bilingual solicitor can help with this.
• It’s also important to keep an eye on the exchange rate to be sure you have an updated idea of the full value of your investment. Find out more about how currency can affect affordability and house prices in Spain.

A mortgage from your home country

There are usually two options for getting a mortgage loan. However, there are notable differences in the process for each country.

The first would be a typical home-buyer product using a cash deposit. Many international banks will offer overseas mortgage services and advice.  

Pros

• The process will be familiar.
• There are no translation fees.
• If you choose to get a mortgage from a bank in your country of residence it will be quicker to prove your eligibility for credit.
• You may have protection from disputes from an established administration. For example, in the UK mortgages are protected by the Financial Ombudsman Service and Financial Conduct Authority.

Cons

• The due diligence on surveys and legal checks may be hindered by a lack of local knowledge.
• Your bank might not offer the market expertise of a Spanish lender.
• You will need to travel to the your home country to provide or sign documentation.

Remortgage an existing property to release equity.

Remortgaging a property is a common alternative to opening a new loan account, and success depends on your credit rating and what outstanding mortgage you still owe. You don’t need to use your existing lender and can get advice from a broker or gather quotes for yourself, but you do need to let your new lender know that the money will finance a house abroad.

Pros

• You may find interest rates are more favourable on a second mortgage.
• You might be able to re-value your home and get more than your original mortgage.

Cons

• You may be at risk if you cannot repay either mortgage (mortgage insurance can help).
• There are quite stringent rules to navigate when remortgaging.

A dual mortgage

Spanish lenders are very accessible, transparent and reliable, but deposits on properties in Spain are higher than in the UK. Those without Spanish residential status may only be able to borrow 60-70% of the house price as a mortgage in Spain.

A solution is to raise money for a deposit via a financial institution in your country of residence.

Find out how Janet and James purchased their apartment in Barcelona using a combination of an interest-only mortgage from a UK lender for a 40% deposit plus a Spanish mortgage to cover the final 60% of the purchase price on our podcast.

Pros

• This is an efficient way to find the capital for your deposit and associated costs.

Cons

• Communications between 2 large financial institutions can slow down paperwork.
• Having no instant equity can be riskier. Be prepared to make a long-term investment and investigate market stability in the area.

Purchasing a buy-to-let property

You can support payments on a holiday home by leveraging rental yields. However, the specific buy-to-let mortgage products you find in the UK are not available in Spain. You can still apply for a mortgage in any of the ways we have explained but the lender won’t take your rental income into account during the application process.

It’s advisable to set rent between 115 -125% of the mortgage repayments, so make sure this is feasible in your property before you invest. Your real estate agent may help you predict rental income during your viewing process.

You may be eligible to deduct interest and amortisation from your taxes, so it’s worth seeing a tax-expert to get advice on the region-specific tax laws.

Buying through a company

Opening a Spanish Limited Company (SLC), or using a home-based PLC to apply for a mortgage product will eventually allow you to offset costs or get a rebate on some taxes. However, it’s becoming difficult to find banks willing to loan to either SLCs or PLCs. This is both because the Bank of Spain has to scrutinise loans to protect against money laundering and fraud and because the lending bank will need to perform yearly checks against company infractions or bankruptcy proceedings. 

It’s advisable to speak with a reputable mortgage broker to find the right mortgage in this circumstance.

How currency affects your repayments

If you earn in pounds or dollars but your mortgage is in euros, every repayment is exposed to the exchange rate - if the pound weakens against the euro, that monthly payment costs you more in real terms, and the same applies to your deposit and upfront costs. 

Buyers manage this two ways: borrowing in euros for part of the purchase, so the loan and the property are in the same currency, or using a currency specialist (often with a forward contract) to lock in a rate. For the full picture, see our guide to currency exchange when buying in Spain.

Pro tips and things to consider

• Budget for 40% upfront as a non-resident (deposit + costs).
• Valuations matter – your mortgage is based on the bank’s value, not your purchase price.
• Variable rates dominate – if rates rise, so will your payments.
• Get expert help – brokers and lawyers save you time, stress, and sometimes money.
• Check regional costs – taxes and fees vary by region and property type.

Ready to start your Spanish property journey?

Getting a mortgage in Spain isn’t scary – it just requires preparation and the right local support.

“Talk to a mortgage broker first. It’ll save you a lot of time and probably a lot of money too.” – Alex Radford

If you’re serious about buying in Spain, watch the full video above, or if you’re just starting out, our Spain buying guide walks you through the full legal and buying process step by step, for everything from taxes to residency rules. 

And when you’re ready, start browsing properties – your Spanish dream home might be closer than you think.