Borrow money for housing in Spain

Taking a loan to buy a home in Spain as a Swede can be a difficult and long process. Here are some steps and considerations to keep in mind:

Find a bank in Spain or Sweden

You can choose to apply for a loan through a Spanish or Swedish bank. Many larger banks in Sweden have departments or collaborations with banks in Spain and can help you with the process.

Credit rating and financial status

Just like in Sweden, the bank will examine your financial status and do a credit assessment to assess your ability to repay the loan. It may include showing income and employment documentation.

Size and terms of the loan

The bank will offer you different loan terms, including interest rates and terms. Be sure to understand and compare these to choose the most beneficial loan for your situation.

Loan-to-value ratio and down payment

Most banks in Spain and Sweden do not offer 100% loan-to-value, so you will likely need to pay a down payment. The amount can vary, but it is common for it to be between 20% and 40%.

Notary and registration fees

In addition to the loan, you will encounter other costs, such as notary and registration fees. Be aware of these costs and plan your loan accordingly.

Exchange rate risk

Since you are taking out a loan in a currency other than Swedish kronor, it is important to be aware of exchange rate risk. Fluctuations in exchange rates can affect the total amount you will repay.

Use a real estate agent and attorney

Working with an experienced real estate agent and lawyer in Spain can help you navigate the local process and avoid potential pitfalls.

It is important to carefully research and compare different loan products and consult with financial experts to find the best solution for your specific situation. Having an understanding of the Spanish banking system and local financial laws will ease the process when taking out a loan to buy a home in Spain.