It seems that the number of local bank managers who have authority to underwrite mortgages in their branches is declining rapidly (especially for non-residents).  This means the majority of mortgages are now rubber- stamped by central credit committees, who can be very strict about having the correct documents.

Getting a mortgage approved has become harder and it is taking longer than ever before.  We suggest you allow around 6 weeks from submitting the application to completion, instead of 4 weeks.

Latest Rates

• MAXIMUM LTV: Fiscal Residents 80%
• MAXIMUM LTV: Non-residents 70%

• EURIBOR 1-month: 1,136%
• EURIBOR 3-month: 1,320%
• EURIBOR 6 month: 1,621%
• EURIBOR 12-month: 2,093%
  • Data correct at the time of writing
  • LTV (Loan-To-Value), which is usually based on the purchase price (or valuation, if lower)
  • Most mortgages are based on the annual Euribor with a loading of 1 – 1.5%

You may have noticed that the 12-month Euribor has crept up again making the rate 2,093% at the time of writing, which is nearly 0,8% higher than in April last year.

For every 100.000 euros of mortgage, the monthly premium has increased by 67 euros. Inflation warnings from the European Central Bank (ECB) had led many to believe that the base rate would be increased from 1% at one of this month’s meetings of the Governing Council and those predictions were proven to be accurate, as the rate was increased to 1.25% on 7 April.

This increase ended a 2-year period with the base rate at 1% and this will lead to further rises in the annual Euribor. However, borrowing is still relatively cheap and house prices seem to be stable.

On a more positive note, we are finding that bank valuations are coming in higher than the official deed price for the majority of our cases. This is a good indication that market conditions are more stable than say 12-24 months ago, when a lot more valuations were coming in lower than the deed price and reducing the amount you can borrow.

In the past, if you were trying to sell a property and wanted to buy a new property, there were a number of banks that would allow them to borrow against the existing property to help fund the purchase of the new property.

In effect, you could borrow 100% of the new purchase price plus the fees and taxes and spread the borrowing over the 2 properties.

Now banks see this as 100% borrowing and have stopped the facility. The good news is that some banks are willing to lend on your existing property and you can withdraw up to 60% of the value of this property.

The only catch is that the bank won’t release the funds until they have a mortgage offer from the bank offering the mortgage on the new property and that your debt/income ratio for all debts meet the bank’s affordability criteria.