This is the figure that surprises our clients used to French lending the most: to borrow in Spain as a non-resident, you generally need to put in nearly half the property price. Here is where that figure comes from and how to plan for it.
Why such a large deposit?
For a non-resident, Spanish banks usually finance 60% to 70% of the purchase price, or of the valuation if that is lower. Purchase costs are not financed. The general terms of these loans are covered in our article on mortgages for non-residents.
A worked example
For a €300,000 flat financed at 65%:
- bank loan: €195,000;
- deposit towards the price: €105,000;
- purchase costs (around 13%): €39,000;
- mortgage costs (valuation, arrangement fees): a few thousand euros.
In total, around €145,000 to €150,000 of your own funds, nearly half the price. And you still need a reserve for settling in and any work.
What else the bank looks at
Your debt ratio, stable income and where your deposit comes from: the funds must be documented and traceable. The bank has the property valued; if the valuation is below the negotiated price, the loan is calculated on the lower figure.
Alternatives to reduce the deposit
- Borrowing in France, secured on a property you already own there.
- Using a life insurance policy through an advance or a partial surrender.
- Combining a small Spanish loan with French funds.
Each option has its own cost and timescale: compare them before you start searching, to set a realistic budget.
Knowing your deposit before the first viewing means knowing what you can really buy, and negotiating as a serious buyer.
