Buying a property on the Costa del Sol is an attractive investment opportunity or second home option for many Europeans, Swiss, British, and non-EU citizens. Financing through a Spanish bank is a common option. This guide explains the requirements, conditions, necessary documents, and provides financial examples for different buyer groups.

 

1. Financing Options with Spanish Banks

 

Spanish banks typically offer mortgage loans for non-residents with a term of up to 25-30 years. The maximum loan-to-value (LTV) ratio varies by buyer group:

  • EU Citizens (e.g., Germans, Austrians, Dutch): Up to 70% of the property value

  • Swiss & British (Non-EU Citizens): Up to 60% of the property value

  • Americans & Other Non-Europeans: Up to 50-60% of the property value

The current interest rates for 2025 range from 3.5% - 4.5% variable or 4% - 5% fixed, depending on the applicant’s creditworthiness and chosen bank.

 

2. Mortgage Requirements

 

To obtain a mortgage from a Spanish bank, buyers must meet the following criteria:

✅ Stable income: Proof of salary payments or self-employed income ✅ Debt-to-income ratio: Monthly loan commitments should not exceed 35-40% of net income ✅ Good credit history: No negative credit reports ✅ Equity contribution: At least 30-50% of the purchase price plus additional costs, depending on nationality

3. Required Documents for Mortgage Application

 

The following documents are required by Spanish banks to process a mortgage application:

???? Passport or ID card ???? NIE number (Tax ID for foreigners in Spain) ???? Proof of income: Last 3-6 months' pay slips, last 2 years’ tax returns ???? Bank statements from the past 6 months ???? Debt overview: Loan agreements or mortgage statements ???? Property purchase contract or reservation agreement ???? Proof of equity contribution

Additional documents may be required, especially for self-employed individuals and business owners.

 

4. Financial Examples for Different Buyer Groups

 

Example 1: Financing for a German Buyer

  • Property price: €500,000

  • Mortgage (70% financing): €350,000

  • Equity contribution: €150,000

  • Interest rate: 4% fixed

  • Term: 25 years

  • Monthly payment: Approx. €1,850

Example 2: Financing for a Swiss Buyer

  • Property price: €500,000

  • Mortgage (60% financing): €300,000

  • Equity contribution: €200,000

  • Interest rate: 4.2% variable

  • Term: 20 years

  • Monthly payment: Approx. €1,850

Example 3: Financing for an American Buyer

  • Property price: €500,000

  • Mortgage (50% financing): €250,000

  • Equity contribution: €250,000

  • Interest rate: 4.5% fixed

  • Term: 15 years

  • Monthly payment: Approx. €1,900

5. Additional Financial Services from Our Partner Bank

 

As an official partner of a Spanish bank, we offer our clients tailored financing solutions:

???? Opening a Spanish bank account for transactions & additional costs ???? Mortgages with fixed and variable interest rates ???? Special conditions for investors & second home buyers ???? Complete processing and consultation in German & English

Conclusion: Is Financing on the Costa del Sol a Good Option?

 

Financing a property in Spain can be an excellent opportunity to acquire a house or apartment on the Costa del Sol. Particularly for Europeans, the conditions are favorable as they can secure higher loan amounts.

We are happy to assist you in financing your dream property and will guide you through the entire process. Contact us for a personalized consultation!