Tenerife Mortgages - Mortgages in Tenerife

As in the UK, there are many mortgage products available in Tenerife. Choosing what’s right for you depend’s on your own personal financial situation and criteria. All we can do here is answer fully the most frequent questions we are asked from our clients. Our staff have been trained to advise you on the various products offered to you from a multiple number of banks. When Home Tenerife finds your perfect Tenerife property, we can advise you based on your specific circumstances and needs to owing your holiday Property in Tenerife.

The service Home Tenerife provides to YOU

We can organise your mortgage from start to finish. There are many bank offering lenders finance on buying a property in Tenerife, but we are also very conscious of the ongoing quality of service you will receive from your lending bank. Fortunately, after so many years of helping people own their Tenerife Property, we have amassed a great deal of experience which will prove invaluable.

We’ll advise you on banks who are able to help, not just on the day you first take out your mortgage, but in the years that follow. It is important that you deal with a bank who speaks your native language, who is accustomed to the situation of an overseas owner and who will be helpful to you today and into the future.

Is it best to borrow in Pounds Sterling or Euros?

There are an increasing number of lenders and banks in the UK competing to provide mortgages for owning a foreign property. These mortgages tend to be established in Pound Sterling. The advantage that a sterling mortgage offers you is that you will not have to worry about exchanging money.

The disadvantage is that UK interest rates have historically been higher than in Europe, and that makes the mortgage repayments more expensive for you. Other factors to consider are that it is possible to use exchange rate fluctuations to your advantage, depending on your own financial circumstances.

How much can I borrow?

This tends to vary from bank to bank and personal criteria. There is a trend on the current market for Tenerife Estate Agents to claim that they can arrange up to 100%, mortgages. It can be done… we can do it, but the criteria required to satisfy a lender are more complicated which makes this a little unlikely and it is wiser to simply to follow the guidelines below.

As a proportion of the value

Bank’s here will lend up to 70% of the value of the property. That’s on a official valuation, carried out by the bank’s recommended surveyors.

As a proportion of the purchase price

Again, for a non-resident, banks will generally lend up to 70% of the purchase price of the Tenerife Property you will be buying.

Against my income

Generally most banks will lend so that repayments do not exceed 30%-35% of your remaining monthly income after you have paid repayments for other loan and mortgage repayments.

These lending guides apply to a non-resident buying in Tenerife and the mortgage criteria. If you are a resident of Spain and moreover working, then call us to discuss your circumstances.

In cases like this the lending bank depending on criteria could lend up to 100%. If you are self employed, then you will need to forward your business accounts to he bank in order that they many compete the mortgage application.

Can I use my assets in the UK?

You can also mortgage UK property assets and use the funds released to purchase property in Tenerife.

How much will the repayments be?

Interest rates are lower in Europe than they are in the UK and are set against the Euribor. You can check for the average Euribor rates by calling at any local bank or in any of the financial sections of the local papers. Generally your mortgage repayment interest rate will be up to 1% above the Euribor.

Other things to take into account

There are certain fees when you take out a Tenerife Property mortgage. These are standard bank fees and are common to all lenders. The exact amounts will depend on the value of the property being purchased and the size of the borrowing.

Loans can be taken with fixed or variable interest rates, and the term of the loan can be affected by your age. Most banks will approve mortgages going up to your 70th birthday.

The solution

There really is only one solution. Sit down with us, and let us discuss it in detail and help you to weigh up all the variables. No one solution will fit everyone, so meeting as soon as possible will be the wisest option. If you let us know some dates when you are available, we can set up a time with a couple of banks to advise and guide you towards your Tenerife Property purchase.

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