Applying for a mortgage is a very common procedure when it comes to buying a property in Mallorca. But it is also a complex operation not without risks, which is why we advise acting cautiously and requesting information from a qualified professional. You should carefully study the details of your loan (the law allows a period of 3 days in which to do so) and very importantly, always use a trustworthy solicitor who can provide legal security for the important step you are about to take.
Currently it is very easy to be approved for a mortgage in Mallorca if you have savings and certain employment security, however it is very important to negotiate intelligently and carefully with financial entities who offer their mortgage services, which is why it is essential to prepare a dossier with all of the documentation which the bank will ask for if they decide to study your mortgage request process (monthly salary or other deposits, savings, debts, equity…). That is to say, when it comes to applying for a mortgage in order to buy a property in Mallorca you must be able to show that you won’t have issues making the repayments.
In reality, every mortgage can be a minefield, with noticeable differences in regard to the rates of interest, fees, related products (insurance, cards, other associated services…) and especially, the daunting small print in the contract, which we must examine with great attention to detail and with professional guidance if necessary, in order to avoid unpleasant surprises in the future.
It’s important not to pay too much attention to the interest rate on mortgages, as at times they can lead to confusion because, although they might be lower than other mortgages, they can be linked to a series of collateral charges (life or home insurance, pension plans, direct debits, preferential treatment for the use of credit cards by banks…) which can drastically affect the final cost left to pay, without forgetting the setting up charges (don’t forget that it’s not just the buyer who has to pay them) and the notary costs, depreciation policies or for premature cancellations, commissions…etc. It is also worth taking your time to read through the mortgage contract in order to detect (and report if necessary) the presence of possible unjustified clauses (such as the typical Spanish “revision clauses”) and study the time limit for the mortgage and try to find a balance between the number of instalments and the monthly payment to be made.
To summarise, you must keep in mind that a mortgage is a tool which is at your disposal so that you can fulfil a dream which ultimately can result in buying a property in Mallorca that you love and not to just make the bank a profit. Which is why, if there’s a cheaper mortgage product on the market which offers the opportunity to change mortgages, if once you made your calculations you come to the conclusion that it is worth it to do so, there’s no reason for you to be throwing your money away…change banks and mortgages with no problem. And don’t forget that for any query regarding the application for a mortgage to buy your property in Mallorca, you can come to Pollentia Properties; our professionals can guide you through everything so that you can choose the mortgage which is best suited to your interests and resources.
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