Bank, Money Transfer & Mortgage


Spanish Banking Assistance



Bank Account
We walk you through the steps of opening a bank account in Barcelona.

Mortgage
We offer advice on the local banks, rates and document requirements.

Money Transfer
Bank to bank transfers are very expensive. We partner with a licensed exchange broker that can save money. We also advise on transferring in compliance with Spain’s strict anti money-laundering laws.

A Client’s True Mortgage Story


 

Tom found a flat in Barcelona and applied for a mortgage. He received the bank’s ‘preliminary approval’ but not the interest rate. Under pressure from the Agent, he paid a 10% deposit for the flat. Then the bank approved his mortgage, but still did not reveal the interest rate. Finally, two days before close, the bank told Tom the interest rate and other terms.

The terms were not ideal, but Tom could not negotiate or shop around. He needed the money right away to buy the flat. If he had had more time, he might have found better terms. But as it was, he was stuck with the rates the bank decided.
 

We Advise on Mortgages

In a Stress-Free Manner

To avoid Tom’s experience, We advise that you:
1) Use a branch located in the town/city where you buy the property;
2) Talk to several banks and compare rates and
3) Get the interest rate and fees before you commit to buy the property.

Below is a list of common documents banks require to get a mortgage. The list varies depending on the bank.
Basic
1) Passport
2) Spanish NIE
3) An assessment of the property
Proof of Income
1) Recent employment pay-check receipts
2) Income tax return(s)
3) Bank statements
4) Letter from employer
5) If self-employed, company business records
6) Proof of pension, investment and other income
Other
1) Proof of all debts including loans and mortgages
2) Extraordinary Expenses

Using a Local Branch

Each region of Spain has their own purchase procedure. Thus, If you buy in Barcelona, you should apply for a mortgage with a bank in Barcelona. They know the local procedure and are accustomed to working with the Notaries and Advisors in Barcelona. This helps ensure a smooth transaction.

Below are standard terms and costs for a mortgage in Barcelona. Some terms are negotiable.
1) Amount. From 50% to 70% of the purchase price for Spanish non-residents and up to 80% for Spanish residents.
2) Interest Rate. This can be variable (euribor + %) or fixed. The fixed rates normally range from 3% to 5%.
3) Length of loan. Normally 30 years is the maximum.
4) Opening Fee. This varies widely among bans, 1500€ is normal.
5) Property Insurance. The banks require that you buy the insurance through them and the cost varies.
6) Life Insurance. Some banks require that you buy this for the length of the loan. Cost varies.

How to Open a Spanish Bank Account


All banks require a passport, and some a Spanish ID (NIE), to open an account. Transferring funds normally requires additional documents depending on the bank and your country of citizenship.
Banks require the company’s articles of incorporation, Spanish tax registration number (VAT) and the passport(s) of the company director and shareholder(s) with 20% or more of company shares. If a shareholder is a company, you’ll need that company’s incorporation data as well. You may need additional documents depending on the bank and the director’s and shareholder’s country of citizenship.
The company must register with Spain’s tax authority and obtain a tax identification number called a VAT number. Also required are the passports of the company director and major shareholder(s). If a shareholder is company you’ll need to supply that company’s registration information. You may need additional documents depending on the bank and the shareholder’s country of citizenship.

Money Transfer – Save Money

An Exchange Broker

Very Important: Never transfer money from your bank to your Spanish bank. You’ll get a terrible exchange rate. Use a licensed exchange broker instead. We partner with Smart Currency Exchange in London. See below. They offer good exchange rates, no commission and their customer service is excellent. Just remember: Don’t send bank to bank!

Origin of Funds

Spanish law requires a property buyer to prove the origin of all funds used to buy the property. Thus, when you transfer funds to Spain, the bank will ask for this proof. The documents required vary depending mostly on the country where the transfer originates.


Smart Currency Exchange


Spain Advisors partners with Smart Currency Exchange of London. Smart is an experienced transfer service that has transferred billions worth of UK pounds and US dollars to banks all over the world. They specialize in overseas property purchases, they offer good rates and their custom service is outstanding. Click below to open an account and get a quote for a transfer.

Get a Free Quote



Frequently Asked Questions (FAQ’s)


In Barcelona; it’s best to use a bank located in the town or city where the property is located. Every region in Spain has their own procedure for buying property. A local branch should know these rules. There are several Spanish and international banks with branches in Barcelona.
If you live in Spain, it’s highly recommended. All utility bills and taxes are paid by direct debit; checks are not used. A local bank can normally make transfers, and provide other services, at better rates than a bank located outside of Spain.
If your company has no ‘permanent establishment’ in Spain, you just have to register your company in Spain in order to receive a VAT number. With this, and company-owner information, you can open a bank account. Most offer accounts in different currencies. If you have a ‘permanent establishment’ in Spain, you have to incorporate your company in Spain, then open the account. The company will then be subject to paying taxes in Spain.
Most of these are just a referral service. They refer you to a bank, then disappear. They’re free because the bank pays them a referral fee; normally 1/2 of the 1500€ ‘opening’ fee (we try to negotiate this fee down or eliminate it).

Be careful: The broker could refer you to a bank located outside of the town or city where the property is located. This can cause problems as each region in Spain has their own rules and procedure. In Barcelona, for example, it’s very difficult to work with an out-of-town branch (we speak from experience).

Second we negotiate the mortgage and try to eliminate the opening fee. A broker has no incentive to do this. They’re paid by the bank.

Yes, residents get better terms. In bank terms, a Spanish ‘resident’ is someone who files a tax return in Spain. A ‘non-resident’ does not. (It doesn’t matter how long you’ve lived in Spain, etc.) If you buy property as a ‘non-resident’ they treat the property as your second home and the terms are not as good. In fact, some banks won’t offer a mortgage to a non-resident.
 

Would you like some help?


Getting information from banks is not easy, especially information about their fees. You usually find out what they charge, after the service has been provided. And learning by experience is no fun. We’ve been working with Barcelona banks a long time. We can get you straight information and make things easier. For advice, email or call. Thanks again for visiting our site.

Drop Us a Line


 

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