Complete Guide to Financing Your Property on the Costa Blanca: Everything You Need to Know

At GestaliHome, we understand that financing a property can be a complex task, especially for those who are not familiar with the Spanish real estate market. That's why we collaborate closely with trusted financial intermediaries who have experience in the sector and can help you find the best financing option for your particular situation.

In this article, we provide you with the key aspects you need to consider when financing your property:

1. Know Your Budget:

When applying for a loan to purchase a property in Spain, it is crucial to have own funds between 40% and 50% of the property value. This is because you will need to come up with at least 30% of the property value as an initial payment, plus associated costs that are around 13% (taxes and other fees).

If you want more information about the costs associated with the purchase, we invite you to read our article: "The Costs Associated with Buying a Property in Spain: What You Need to Know Before Acquiring Your New Home".

2. Debt-to-Income Ratio:

This ratio indicates what percentage of your monthly income is allocated to debt repayment, including the mortgage payment and any other loans you have. Banks typically set a prudent limit: the total amount of these payments should not exceed 35% of your monthly income.

3. Plan Your Age at Loan End:

Note that the maximum age for most mortgage loans is 72 years at the end of the loan term. This means that the last loan installment should be scheduled so as not to exceed that age.

4. Consider Factors that Improve Your Credit Score:

Banks view favorably those with a solid credit history, meaning individuals who have demonstrated responsibility in managing their previous debts. Those who demonstrate a stable employment history and income continuity are perceived as less risky for banks.

In addition to the factors mentioned above, having more than one co-borrower when repaying the loan can be beneficial. If you have a co-owner who also has a solid credit history, this can strengthen the loan application and improve the chances of approval. Also, maintaining a low credit utilization rate, meaning not using a large portion of the available credit limit on your credit cards, can indicate financial responsibility and positively contribute to your credit score.

5. Work with Trusted Professionals:

At GestaliHome, we can recommend you trusted financial institutions and mortgage advisors who have experience in the Spanish real estate market. These experts can advise you on the different financial products available and help you find the option that best suits your needs and specific circumstances.

Contact:

Phone: +34 604 22 57 09

Email: info@gestalihome.com

Office: Plaza Músico Óscar Tordera Iñesta 11, 03004, Alicante, Spain.

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