In Spain there are lots of autonomous areas, each with their own regional federal governments, so it will be difficult to detail each and every circumstance varying from Valencia to Bilbao, Barcelona to Seville, but this short article will attempt to provide an in-depth overview of the basic situation, rather than a gloss-over of the bottom lines.
Perhaps the first indicate point out is that in Spain there are two primary monetary entities that you can request a home mortgage from. The banks in Spain work all on a similar basis, and are classes as Bancos - International brands such as BBVA and Banco Santander will recognize with the majority of readers. The second type of entity are the "cajas" or "cajas de ahorros" which are normally self-governing societies, formed as savings banks or building societies - frequently born in rewarding autonomous regions and sometimes broadening across the country. Perfect examples would be Caja Madrid, Catalunya's La Caixa, and Caixa Catalunya. These entities are sometimes simpler to get a home mortgage from, although conditions can often be simpler controlled to the favour of the caja, instead of those guidelines rigorously set down by the Banco de España.
It's incredibly common in Spain for an interest rate to be applied to your loan sum on an annual basis, with a modification each calendar year, around the very same date as you sign your home mortgage. This suggests that although interest rates might vary, as they tend to do, then if you occur to sign your home loan in the "highest peak" of interest, then you will pay that amount of interest for the entire year - even if interest rates go down. Mortgage "trackers" working on a month to moth basis, understood throughout the world, are unidentified in Spain.
Simply to make things more complicated, there are then two different kinds of indexes your bank or building society can opted to use concerning your policy. The Euribor is the European Rate of interest, although it's worth noting that within the Eurobor, there is a different (constantly higher) Euribor Home loan rate.
The second Interest rate that might be used is the more stable IRPH, which takes an average of the previous 4 months Euribor then computes the rate by doing this. Any loan from a bank or building society will charge the client (that's you) one of these 2 rates, plus anywhere in between 1-3%, depending upon the risk, size of the property, readily available guarantors, and so on (remember, my example here is for first time purchasers).
Any loan from either entity normally has a 1% opening fee on the net rate, and the same for any cancellation prior to the time of the loan expires - loans are normally provided for 30 years, although in recent years, specific banks have offered loans of up to 50 years, or those which will be inherited by next of kin/offspring. This suggests that swapping and altering home loans over banks is nearly impossible in Spain, offered the costs included.
Possibly the very first point to discuss is that in Spain there are 2 main monetary entities that you can apply for a home mortgage from. It's very typical in Spain for an interest rate to be applied to your loan amount on an annual basis, with a modification each calendar year, around the same date as you sign your home mortgage. This implies that although interest rates might fluctuate, as they tend to do, then if you here occur to sign your mortgage in the "greatest peak" of interest, then you will pay that quantity of interest for the entire year - even if interest rates go down. Home mortgage "trackers" working on a month to moth basis, known throughout the world, are unknown in Spain.