I’m almost done with house hunting and have moved on to the most daunting part: the mortgage. I’ve visited several banks and done a lot of research online, and I feel that Spanish banks offer a dizzying array of mortgage products, especially when it comes to fixed and mixed rates, with each bank offering different terms. I thought I’d share my findings here for discussion, to see if I’ve missed any crucial information and to serve as a reference for others who will be applying for a loan soon.
Overview of Mortgage Rates from Major Banks
I’ve been focusing mainly on fixed-rate mortgages and mixed-rate mortgages (fixed for the first few years, then variable), as the future of Euribor seems uncertain, and a purely variable rate is a bit too much for my peace of mind. Below is a summary of the approximate interest rate ranges currently offered by some major banks, considering the general Spanish bank fees. Please note, these rates are highly personalized and depend directly on your income, down payment percentage, and whether you purchase additional products from the bank, which also relates to Spanish bank fees. Therefore, the table below is just a starting point; you absolutely must negotiate the specifics with a bank manager yourself!
Comparison of Fixed/Mixed Rates from Major Banks
| Bank | Mortgage Type | Reference TIN | Additional Conditions |
|---|
| CaixaBank | Fixed | From 2.80% | Payroll, Home insurance, Life insurance |
| Santander | Fixed | From 2.90% | Payroll, Credit card spending, Various insurances |
| BBVA | Fixed | From 2.75% | Payroll, Home/Life insurance |
| Sabadell | Mixed | From 2.60% for the first 5 years | Payroll, Home insurance, Spending requirements |
| ING | Mixed | From 2.99% for the first 3 years | Payroll, Home/Life insurance |
As you can see from the table, to get the advertised lowest TIN, you basically have to commit to the bank’s full package of products. I want to emphasize that besides the TIN, it’s more important to look at the TAE. The TAE includes various fees and the cost of additional products, more accurately reflecting your actual annual loan cost. Some banks have a very low-looking TIN, but when you factor in all the insurance policies and annual card fees, the TAE for their Spanish mortgages can be much higher than others. Don’t be fooled by the superficially low interest rates.
I’m starting to think that a mixed rate is also a good option. The rate is locked in for the first few years, giving you a buffer period before it switches to a variable rate based on market conditions. For example, Sabadell’s 5-year fixed period could be quite favorable for someone expecting a significant income increase within five years. Personally, I’m currently leaning towards the fixed-rate options from BBVA and CaixaBank, as they seem more straightforward and worry-free. Has anyone managed to get a lower rate recently? Or do you have any negotiation tips? Feel free to reply and share your experiences. Let’s figure out how to get the best deal from the banks together!
