Pros and Cons of buying a Spanish property from a Spanish bank

Buying properties from Spanish Banks

El Gorgo de la escalera (Courtesy of Monika Manowska,professional photographer)


Spanish banks are in financial problems and wish to get rid of their Spanish properties as quickly as possible and so they are now offering real bargains.

Indeed, nowadays banks have more properties in their portfolios than Estate Agents do so. They even offer mortgages at the best interest rates, in order to help you to make up your mind about purchasing a property.

But, before buying a property from a bank, you should think carefully – to see if the deal being offered by a Spanish bank is really as good as it sounds.

List of main Pros offered by the Spanish Banks:

–        100 % mortgage or even higher

–        Long mortgage repayment (up to 50 years)

–        Valuation paid (you save up to 300 €)

–        Low Interest Rate

List of main Cons:

–        Selling price might be higher than similar ones in the marketplace

–        They might offer you 100 % mortgage but you will still need some savings (10 % of the selling price) to cover the costs of buying.

–        Spanish Banks may request personal guarantees.

–        It is common to find bank properties are in a bad state, as the bank will have re-possessed them from disenchanted owners and the properties may have been them empty for a long time.

–        If the properties are not brand new, then you cannot pay VAT (4% until the end of this month) – your purchase will be subject to Transfer Tax (7%).

–        You might have to purchase the property as seen and in a very short period of time – thus not allowing you time to make the proper legal searches (very important!).

–        You might have to face all the costs related to the property, as the banks will not pay them (extremely important to check!).

So – be careful with bank properties.  Not everything may be quite as simple and straightforward as it may seem…

If you have any queries then do, of course, contact me for further information.


Carolina Just Miro

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