In Spain there are lots of autonomous areas, each with their own regional governments, so it will be difficult to detail each and every circumstance varying from Valencia to Bilbao, Barcelona to Seville, but this post will attempt to provide an in-depth overview of the general scenario, rather than a gloss-over of the main points.
Maybe the first point to discuss is that in Spain there are 2 main monetary entities that you can apply for a home loan from. The banks in Spain work all on a comparable basis, and are classes as Bancos - International brand names such as BBVA and Banco Santander will be familiar with a lot of readers. The 2nd type of entity are the "cajas" or "cajas de ahorros" which are typically self-governing societies, formed as savings banks or constructing societies - often born in worthwhile self-governing areas and occasionally expanding across the country. Perfect examples would be Caja Madrid, Catalunya's La Caixa, and Caixa Catalunya. These entities are often easier to acquire a home loan from, although conditions can typically be easier manipulated to the favour of the caja, rather than those guidelines carefully set down by the Banco de España.
Now within the Cajas or Bancos, there are numerous items available when it comes to taking a loan out on a property. For the sake of example, let's take a first time buyer on a starter house. Possibly among the primary distinctions in any kind of loan from a monetary entity is the kind of interest paid. It's extremely common in Spain for an interest rate to be applied to your loan sum on a yearly basis, with a modification each fiscal year, around the very same date as you sign your home mortgage. This means that although interest rates may vary, as they have the tendency to do, then if you take place to sign your home loan in the "highest peak" of interest, then you will pay that amount of interest for the whole year - even if rates of interest decrease. This has the advantage of constantly understanding your month-to-month spending plan of costs, however the reverse holds true because if you accompany a peak which then drops drastically, you're stuck to the exact same rate for the remainder of the year. Home loan "trackers" working on a month to moth basis, known across the world, are unknown in Spain.
Just to make things more complicated, there are then 2 various kinds of indexes your bank or building society can decided to employ regarding your policy. The Euribor is the European Rates of interest, although it deserves keeping in mind that within the Eurobor, there is a different (always higher) Euribor Mortgage rate.
The 2nd Rates of interest that may be applied is the more stable IRPH, which takes approximately the previous 4 months Euribor then determines the rate by doing this. Any loan from a bank or building society will charge the client (that's you) among these 2 rates, plus anywhere in between 1-3%, depending on the risk, size of the home, readily available guarantors, etc. (remember, my example here is for very first time purchasers).
Any loan from either entity typically has a 1% opening cost on the net cost, and the same for any cancellation prior to the time of the loan expires - loans are normally provided for 30 years, although in current years, specific banks have provided loans of up to 50 years, or those which will be inherited by next of kin/offspring. This indicates here that swapping and altering home loans over banks is nearly impossible in Spain, offered the costs included.
Possibly the very first point to discuss is that in Spain there are 2 main monetary entities that you can apply for a home mortgage from. It's incredibly typical in Spain for an interest rate to be applied to your loan amount on an annual basis, with a modification each calendar year, around the same date as you sign your home mortgage. This implies that although interest rates might fluctuate, as they tend to do, then if you take place to sign your mortgage in the "greatest peak" of interest, then you will pay that amount of interest for the whole year - even if interest rates go down. Home mortgage "trackers" working on a month to moth basis, known throughout the world, are unknown in Spain.