Remortgage in Spain
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Remortgaging in Spain?
Improve your mortgage
In Spain most mortgages are contracted with variable interest rates. One of the advantages is that you can benefit from incremental drops of the interest rate. As the mortgage interest rates are now incredibly low, it may be advantageous to fix the interest rate. There are two ways to improve the conditions of your mortgage: by a ‘renewal’ or by ‘refinancing’ your mortgage.
Renewal of your mortgage
With a mortgage renewal, the existing conditions will be renegotiated at the same bank where the mortgage was contracted. In addition to interest changes, a renewal may also change conditions such as:
- raising the loan amount
- changing the term
- changing the mortgage holder
- changing the mortgage type
As soon as an agreement has been reached with the bank about the changes, the renewal can be formalized. Depending on the type of changes the mortgage deed will have to be changed at the notary.
Refinancing your mortgage
If it appears that the bank does not want to cooperate with the changes or improvements of the economic conditions, you can choose to refinance your mortgage with a different bank. The goal of refinancing is to improve the interest rate. The current mortgage will be ‘replaced’ by the new mortgage, thus the current mortgage will be cancelled and a new mortgage deed with new conditions will be drafted and signed.
First the financial situation will be assessed and a valuation will be made. If application for refinancing is approved, the ‘new bank’ will make a new mortgage offer. This will then be presented to the current mortgage bank by the notary. If no counter offer is made by the current bank after 21 days, there is an automatic agreement to refinance the mortgage.
This type of refinancing is called ‘subrogación’ and is cheaper than setting up a whole new mortgage as the costs for the mortgage tax do not have to be paid. Only the costs of the valuation, notary, register and gestoría will have to be paid by you.
Do the Mortgage Quick Scan to find out if you qualify for refinancing your mortgage.
Maarten, self-employed in the Netherlands (mortgage for a house in Marbella)
Via Euro Economics I came across WeCare Mortgages to finance our Spanish house. Saskia of WeCare Mortgages helped us excellently in Dutch. It is not always easy for entrepreneurs to get a mortgage. Saskia and her team know exactly what is required in Spain. They do not hesitate to invest a lot of time in a custom made solution, despite the complexity of a non-standard request.
Thumbs up for the drive and ambition to help customers as best as possible!
Mortgage refinancing ánd renewing
When refinancing the mortgage to lower the interest rate, you can also request a change or renewal of other conditions. For example, increasing the loan amount or extending the term.
WeCare Mortgages will help you
Before you choose to refinance and renew your mortgage it is wise to first identify all the costs. We can take over the work and supervise the entire process. We have many years of experience in negotiating with banks and making real calculations. We will explain all the options so you understand your options.
Do you want to know what your options are? We will be happy to make a Mortgage Quick Scan for you.