When we decide to buy a property, the mortgage becomes an essential procedure in most cases. For which at least, we must have 20% of the capital saved, as mortgage lenders do not reach more than 90% of the appraisal value.
One of the most important variables to determine the price of the mortgage of the house is the Euribor plus a differential, which varies according to years and months. You can see an improvement in the conditions of the mortgages of the banks and now may be a good time to take out a mortgage. The data show that there is an increase in mortgages in Spain. According to the National Statistics Institute (INE), fixed rate mortgages increased by 17.4% in annual rate, with an average interest rate at the beginning of 3.05% compared to 2.37% of those assigned to variable rate. This data is also guaranteed by notaries.
How to calculate the cost?
The first thing we should think about is calculating costs, something we have already done before when we have been interested in buying a specific house in question. We must analyze the monthly cost of the mortgage loan, and to negotiate or get the best, the cost must not exceed 30% of our monthly income. That way, we make sure the mortgage doesn’t drown us.
What types of mortgage are there?
Depending on your income, we will choose one type of mortgage or another. It is essential that the buyer has the maximum information and knows which mortgage is best for him, fixed rate, variable or mixed. The new Real Estate Credit Law, which we have already mentioned in this article, reduces commissions such as early repayment and modifies the distribution of costs, where the valuation is the only cost that remains for the buyer, the rest must be assumed by the financial institution.
And there are other factors, because according to UCI, the economic conditions of the operation are established according to its characteristics: amount requested, term, use and type of property acquired and profile of the borrower. In this case, the financial institution adjusts its conditions according to the risk and quality of the operation.
Another factor to consider is valuation and how to use it intelligently. Many people think that the appraisal is a procedure that has to be requested by the bank. But anyone can apply for a mortgage appraisal directly to an appraiser approved by the Bank of Spain.
What’s more, it is recommended that the owner who wants to sell his property, what to do this procedure, to facilitate the buyer’s decision, because if there is appraisal, the study and the response of the bank to it is much faster. During the six months of validity of the report, you can use it so that the buyer negotiates the mortgage conditions with different banks in search of the offer that best fits their interests. It can be used to negotiate the price with the buyer. This will avoid, for example, signing a deposit contract for a purchase price much higher than the appraised value, which would make it impossible to obtain the mortgage you need. In addition, you will have in your possession a professional report that provides peace of mind and transparency on the urban, constructive, legal and registry of the home.
New or second-hand property
Many buyers wonder if there are differences in mortgage negotiation when it comes to new or second-hand homes. In most cases, the buyer of a new home is subrogated to the mortgage previously constituted by the developer, normally these are standard conditions for all the purchasers of the development, while in second-hand purchases, the conditions are fixed according to the characteristics of each operation. With the new Law of Real Estate Credit the great advantage that had the subrogation of the loan of the promoter to the final client, that was to save the tax of AJD, has been lost, since now in any of the cases this tax is assumed by the entity.
It is fortunate that new technologies provide us with all kinds of information, often without leaving home. Mortgage comparators are a perfect solution to take a first step and know how the market is and the conditions that each entity offers when taking out a mortgage. From there, as we are not experts in the matter, we are going to need professional help.
Real estate agent, consultant, lawyer…
In the process of negotiating a mortgage it is vital to be accompanied by agents in this sector who will help us set and negotiate the price we want. Therefore, figures such as a real estate advisor, a lawyer or an economist are essential. In addition, the Law regulates the participants in the process of information and formalization of a mortgage loan indicating their functions, requirements and responsibilities. The tandem formed by the real estate agent together with the consultant is the best option for clients to acquire and finance a home with maximum security and total transparency.
If you need a mortgage, do not hesitate to consult me. +34 602944847