Word “mortgage” has recently taken on a deeper meaning in the lives of many Spaniards. While getting a mortgage is a natural step towards homeownership, changing economic conditions and strict criteria banks made the process more complex and challenging. What exactly do banks look for when it comes to providing mortgages?
The development of mortgages in Spain
From a broad perspective, mortgages They are having a hard time in Spain. According to incoming data National Institute of Statistics (INE)It was observed that the mortgage company decreased by 18.83% compared to the previous year. Specifically, as of July 2023, only 29,223 mortgages had been signed, which is more than enough on its own. The reasons behind this decline relate to factors such as: Job instability and increase in interest rates.
Ideal profile to get a mortgage
If you ever wondered What is the ideal profile that banks in Spain look for when granting mortgages?, You’re not alone. Simone Colombelli from iAhorro says the main goal of banks when giving money for a house is for the customer to be able to comfortably pay the monthly mortgage payment. Jobs and economic stability are top priorities.
To go into more specific details, The average mortgagee in Spain is in the 37 age group, has a monthly net salary of 2,450 Euros and has more than 7 years of work experience.. Additionally, an interesting fact is that most mortgage holders tend to buy as a couple, which usually means a combined income is used to qualify for the mortgage.
Banks also placed tighter limits on the amount of money they were willing to lend. 100% financing of a property is rare 80% is the new standard in most cases these days.
Ideal candidates for a mortgage in Spain
While every situation is unique, there are certain profiles that tend to get approval when it comes to it. to ask mortgages:
- Authorities: The salaries of civil servants, who are considered the crown jewel of the mortgage world, are fixed and therefore the risk of default for banks is minimal.
- Permanent contract workers: You’re lucky if you have a contract of at least one year! Banks view these applicants positively.
- temporary workers: The industry you work in plays a very important role here. Some sectors, such as education and health, are preferred more than others.
- Self-employment: Despite freelancers’ perception that the road is difficult, there is still hope. If they can demonstrate long-term solvency, the doors of the mortgage world may be opened to them.
In short, although the mortgage landscape in Spain has changed and become more challenging, being well informed and knowing the profile banks are looking for can make the difference between being successful or facing rejection. Good luck with your mortgage search!