Developers Mortgage

If you are buying a property off plan you should be offered the developers mortgage prior to completion.

The developer’s mortgage is a mortgage that is already on the property. It is what the developer has used to pay for the build.

If you pay for the property with cash or an alternative mortgage then the developer’s mortgage will be cleared on completion and the property transferred to you free of the mortgage. However, you should also have the option of taking over the mortgage. The advantage of doing this, as opposed to getting your own mortgage is that a lot of the set up costs have already been paid.

The disadvantages are that often the developer’s mortgage is not as good as some mortgages available in the open market. The interest rate may be higher, the term may be shorter and if you want interest only, often this is not available on a developer’s mortgage.

Although most estate agents will tell you that the developer’s mortgage can be taken on without any problem or paperwork, the reality is that the bank will want to check that you can afford the repayments. This will involve a lot of paperwork on your part and sometimes the whole process can get complicated. Dealing with a Spanish Bank can be difficult.

We provide a service whereby we will liaise with the bank on your behalf. We will check the details of the mortgage on offer and make sure that it is the right one for you. If it is, we will help with all the paperwork and make sure the mortgage is available for when you complete. There is a charge for this service.
If however, the terms of the mortgage are not particularly good and there are better mortgages on the open market we will you advise you of this and help you get a more appropriate loan