Here we present key concepts to help you understand the mortgage landscape.
Spain offers a solid and competitive mortgage system for both resident and non-resident buyers, making the country particularly attractive for real estate investment and the purchase of second homes. Below, we explain how it works:
Financing for residents
For buyers who are tax residents in Spain, banks usually offer more favorable conditions. Financing can reach up to 80% of the lower value between the purchase price and the appraised value. Banks typically require a minimum period of residency, usually between 1 and 2 years, depending on the institution.
The final percentage granted depends on the client’s profile: job stability, income, level of debt, and prior savings.
Regarding the loan term, mortgages can extend up to 30 or 35 years, provided that the borrower does not exceed a maximum age—generally between 65 and 70—at the end of the loan.
Financing for non-resident foreigners
Non-resident buyers can also obtain mortgages in Spain, although under more conservative conditions set by financial institutions.
Financing is usually limited to 60–70% of the lower value between the appraisal and purchase price, and interest rates tend to be higher, as banks assume greater risk when lending to clients without tax residency in Spain.
Conditions may vary depending on the buyer’s country of origin, being more favorable for citizens of the European Union and countries with stable financial systems. The maximum loan term is also generally shorter than for residents and more strictly linked to the borrower’s age.
Interest rates in Europe compared to other markets
One particularly attractive aspect for international buyers is that, historically, mortgage interest rates in Europe have been lower than in markets such as the United States or Canada, even after recent rate increases. This has encouraged many foreign investors to consider Spain a financially competitive option.
Interest rate types: variable, fixed, or mixed
Before the 2008 real estate crisis, variable-rate mortgages were the most common in Spain, driven by a historically low Euribor (the main reference index for loans in Europe). However, the sharp increases that followed changed the perception of risk.
Today, fixed-rate mortgages are the most popular option among buyers, offering stability and predictability. Mixed-rate mortgages (fixed for the first years and variable thereafter) have become an intermediate option, while variable rates still exist but are chosen more cautiously.
The role of mortgage brokers
Mortgage brokers provide a specialized service to analyze the client’s profile and find the best conditions available on the market.
These professionals can be especially useful for:
• Clients close to the maximum age limit who need longer loan terms.
• Buyers who prioritize the lowest possible interest rate.
• Investors who want to eliminate or reduce early repayment penalties.
• Foreigners who are not fully familiar with the Spanish banking system.
If your goal is to buy a property in Spain, you can read our blog article How do I buy a property in Spain if I am a foreigner? to learn about the basic procedures involved.
Work hand in hand with industry professionals—trust the real estate advice of Magenta Living.