Mortgage in Spain – how can a foreigner finance the purchase of a property?

Purchasing property in Spain has enjoyed great interest from foreign clients for years. The sun, a stable market, attractive prices compared to other European countries, and a wide variety of offers mean that buying property in Spain is not only a lifestyle decision but also an investment one. A mortgage can be an excellent leverage here.

Many clients assume, however, that a mortgage in Spain for non-residents is difficult or even impossible to obtain. In practice, there are several flexible financial solutions available that can be tailored to the client’s situation.

Below I present the most commonly used forms of financing property purchases in Spain, offered by banks serving international clients.

Mortgage for non-residents (up to 60% LTV)

This is the most commonly chosen form of financing when buying property in Spain by people living abroad.

Key features:

• Financing up to 60% of value (if the purchase price and bank appraisal differ, which is usually the case, the bank will select the lower amount)
• Loan term usually 20–25 years
• Competitive interest rate depending on client profile and property
• Income must be earned in EUR, USD, or GBP.

Spanish banking regulations require income to come from so-called stable currencies. Therefore, this mortgage loan in Spain works best for clients working in the eurozone, the United Kingdom, or the USA.

Mortgage secured by assets (up to 70–100%)

For clients who want to obtain higher financing than the standard 60%, there is the possibility of applying additional security in the form of financial assets.

How does it work?

• The client transfers an investment portfolio to the bank (usually funds)
• Assets are pledged (pignoración) as additional collateral
• The bank can increase financing up to 100% of the property value.

Who is this solution for?

• Clients who do not want to “freeze” cash
• Investors optimizing liquidity and financial leverage
• People with high assets but lower official income.

This solution is often chosen for larger transactions and premium purchases.

Lombard Credit: financing up to 100% of purchase price

Lombard Credit is one of the most flexible financial tools for international clients, especially from outside the eurozone.

How does Lombard Credit work?

• The client pledges a liquid investment portfolio (funds, ETFs, bonds)
• The bank provides financing at the level of 60–70% of the portfolio value
• Funds can be used for 100% financing of a property purchase in Spain.

Spanish banks cannot provide standard mortgage loans to clients earning income in currencies such as PLN, NOK, SEK, CHF, or AED. However, Lombard Credit is not based on income but assets, making it an ideal solution in such cases.

Main advantages:

• Possibility to finance 100% of the purchase
• No need to prove income in EUR/USD/GBP
• Very fast decision-making process
• Flexible repayment terms.

Mortgage in Spain and property purchase – what to know?

Regardless of the chosen solution, buying property in Spain requires proper preparation:

• analysis of tax residency,
• structure of income and assets,
• purpose of purchase (own use vs investment),
• and long-term financial plans.

A well-chosen mortgage loan in Spain can significantly increase the client’s purchasing power and improve the efficiency of the entire investment. For older people, a good solution may be the so-called hipoteca inversa.

Summary

Purchasing property in Spain by foreigners does not have to mean buying exclusively with cash. If you are interested in the mortgage loan application process, you will also find information about it on our blog. Available solutions: from classic mortgage loans, through asset-secured financing, to Lombard Credit, allow tailoring the financing structure to almost any client profile.

The key is always an individual approach and cooperation with advisors who understand both the local real estate market and international financial realities.

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