Buying a home in Spain is an exciting milestone, whether you’re a local looking to settle down or an expat seeking a piece of the Mediterranean lifestyle. But before you can get the keys, you’ll likely need to secure a mortgage, known in Spanish as a hipoteca.

Here’s what to know about how mortgages work in Spain, from eligibility to approval.

1. Understand the Spanish mortgage market

Mortgages in Spain are offered by local banks (bancos), international banks, and online lenders. You’ll find both fixed-rate and variable-rate mortgages, as well as mixed-rate options that combine the two.

• Fixed-rate mortgages: Your interest rate stays the same for the entire term, giving predictable monthly payments.

  
  

• Variable-rate mortgages: The rate is tied to the Euribor (Euro Interbank Offered Rate) plus a fixed margin, meaning your payments can go up or down depending on market rates.

  
  

• Mixed mortgages: These start with a fixed rate for a few years and then switch to a variable rate.

If you’re an expat, note that foreigners can generally access up to 70% of the property’s value, while Spanish residents may qualify for up to 80%.

Note: Lenders take your age into account when approving a mortgage because it affects the maximum loan term. Most banks cap the term based on how old you’ll be when the mortgage ends. In Spain, terms of up to 30 years can be offered.

2. Check eligibility and requirements

To apply for a mortgage in Spain, banks will look at your income, employment stability, credit history, and existing debts.

Most lenders require:

• A valid ID such as a DNI (for Spanish citizens) or NIE (Número de Identificación de Extranjero) for foreigners

  
  

• Proof of income (payslips or tax returns)

  
  

• Bank statements (usually the last 3 to 6 months)

  
  

• Proof of existing debts or loans

  
  

• Property details and purchase agreement

For self-employed applicants, additional documentation such as business accounts and tax filings may be requested.

Banks typically prefer that your total debt payments (including the mortgage) do not exceed 35%–40% of your monthly income.

3. Where to get a mortgage in Spain

There are two main ways to obtain a mortgage in Spain: through a bank directly or via a mortgage broker.

• Banks: Most buyers apply directly with major Spanish banks such as Santander, BBVA, CaixaBank, or Sabadell. Going directly to a bank may result in slightly lower fees, especially if you already have an account or salary with them. However, each bank has its own lending criteria, so it’s worth comparing offers before committing.

  
  

• Mortgage brokers (intermediarios hipotecarios): A broker can help you find and negotiate the best deal, especially if you’re a foreign buyer unfamiliar with Spanish lending rules. Brokers often have access to multiple banks and can simplify paperwork, though they may charge a service fee or receive a commission from the lender.

Some international banks and digital lenders also offer mortgages in Spain tailored for non-residents, often in English and with more flexible requirements.

4. What is the minimum deposit for a mortgage in Spain?

The amount of money you’ll need for a down payment in Spain depends largely on your residency status.

If you’re a Spanish resident, most banks will finance up to 80% of the property’s value, meaning you’ll need to contribute at least 20% as a deposit.

If you’re a non-resident or expat, lenders are typically more cautious and may offer between 60% and 70% financing, so you’ll need to provide a 30% to 40% deposit.

These percentages apply to standard residential purchases. If you’re buying a second home, investment property, or commercial real estate, banks may require a larger deposit or stricter lending terms.

5. Know the costs involved

Beyond the down payment, you’ll need to budget for several additional costs when buying a home in Spain. These include:

• Valuation fee (tasación): Generally ranges between €300 and €600, depending on the location, size of the property, and other factors.

  
  

• Notary and land registry fees

  
  

• Stamp duty (AJD): 0.5%–1.5% depending on the region

  
  

• Bank arrangement fees: Up to 1% of the loan

  
  

• Property tax (ITP or IVA) depending on whether it’s a resale or new build

In total, closing costs can amount to 10%–15% of the property price.

6. Choose your mortgage and get pre-approval

Getting pre-approved (oferta vinculante) can make the home-buying process smoother. This gives you a clear idea of what you can afford and helps speed up negotiations.

Compare offers from different banks to find the best interest rate and repayment terms.

Expats may find better deals by applying with international banks or brokers who specialize in foreign buyers.

7. Complete the property valuation and sign the contract

Once you’ve chosen a property, the bank will conduct a valuation to confirm its market value. If everything checks out, you’ll sign two contracts:

1. The mortgage deed (escritura de hipoteca)

   
   

2. The property purchase deed (escritura de compraventa)

Both are signed before a notary and registered at the Land Registry (Registro de la Propiedad).

Good to know: Before signing the mortgage deed, you’ll need to meet with the notary for a brief pre-signing consultation, sometimes called a “test.” During this meeting, the notary will ask you a few straightforward questions about the loan’s terms and conditions.

The purpose of this step is to comply with Spanish transparency laws and ensure you fully understand key details of the mortgage, including the principal amount, interest rate, payment schedule, and duration. Once the consultation is complete, you’ll receive a Notarial Transparency Certificate (Acta de Transparencia Notarial).

8. After you buy: Managing your mortgage in Spain

Your mortgage payments are typically made monthly via direct debit from your Spanish bank account. Interest rates and payment terms can vary, so review your contract carefully.

If you plan to rent out your property or eventually sell, talk to a tax advisor about mortgage interest deductions and capital gains taxes, which may differ for residents and nonresidents.

Getting a mortgage in Spain can seem complex at first, but with preparation and the right guidance, you can navigate the process smoothly.