Mortgage blow for Spanish investors

Spanish bank Banesto, part of the Santander group, has decided to withdraw it’s non-resident mortgages on Spanish property. The only product which Banesto will now be offering to buying foreign propertys in Spain is a self-certification loan on behalf of finance company GMAC.

The news is a further blow to foreigners currently looking to buy in Spain with Caja Mediterraneo (CAM Bank) instructing some it’s branches not to accept any more non-resident applications for mortgages on Spanish property. Caja Medierraneo are the largest lender of non-resident mortgages in Spain and their decision comes after a series of false mortgage applications were made by some unscrupulous brokers keen to get deals through so that they would receive their commission.

The financial climate in Spain has changed over the last few years with banks tightening up their procedures for non-resident mortgages. Many now check liabilities and credit files in the buyer’s home country, a fairly new check for most, and amidst the allegations of false paperwork being pushed through, many are now going through every application with a fine-tooth comb.

Many banks are still prepared to give mortgages to buying foreign propertys, however they too will probably be tightening up their security with slightly less loan multipliers than before, or with stricter criteria on the mortgage itself.

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