Spanish Mortgages for Irish Buyers

Freedom of movement, and what it does not buy you

As an Irish citizen you can stay in Spain as long as you like. There is no day counting, no visa, no exit stamp to worry about on the way home. That is a material difference from British buyers, who lost that right and now have to plan their year around it. If you are weighing up a place you intend to use for long stretches in the winter, your position is considerably simpler than that of the couple viewing the apartment next door.

What freedom of movement does not do is change how a Spanish bank sizes your loan. Lenders classify borrowers by tax residence, so an Irish buyer who lives and works in Ireland is a non-resident applicant: 60–70% of the bank's valuation on employed income, 50–60% if self-employed or if the income is complicated. Roughly 80% is available to Spanish tax residents, and spending long periods here is not the same as becoming one. Plan your cash on the non-resident figure.

Euro income against a euro mortgage

Your salary, your pension and your savings are already in euros, and so is the mortgage. That removes a whole category of problem that sterling and dollar buyers have to manage: no exchange rate to watch on the deposit transfer, no monthly payment that moves for reasons unconnected with the loan, and no bank asking how you would cope if your income currency fell against the euro.

It also removes a cost. Moving a large deposit between currencies is rarely free, and the spread on a six-figure transfer is worth avoiding. For you, funds go from a euro account in Ireland to a euro account in Spain. Keep the transfer itself clean and traceable — Spanish banks and notaries will want to see where the purchase money came from, and money that has passed through several accounts takes longer to explain than money that has not.

The Irish paperwork a Spanish bank wants

English-language documents are an advantage here, but Irish forms are not familiar to a Spanish underwriter, so it helps to hand over a complete and labelled set rather than a stack to be worked out:

• Employment Detail Summary — the Revenue document that replaced the P60, normally for the last two years.
• Payslips — the most recent three to six months.
• Form 11, or a Notice of Assessment, if you are self-employed or have non-PAYE income, usually covering two to three years, with accounts to match.
• Irish bank statements over the same period as the payslips, showing income arriving and existing repayments leaving.
• A credit report from the Central Credit Register, the Irish register of credit agreements.
• Passport, and your NIE, which has to be in place before completion.

As with other foreign registers, a Spanish lender cannot look your record up itself, so the Central Credit Register report only helps if you bring it. Expect to be asked for translations of some items; we confirm which ones a given bank actually requires before you spend money on a translator.

Second homes, retirement and the age limit

A good number of the Irish purchases we see are second homes bought with one eye on retirement: used for a few weeks a year now, lived in for months later. That plan runs into one hard mortgage rule. Non-resident terms typically run 20 to 25 years, and lenders generally want the loan repaid by the age of 70 to 75. If you are in your fifties, the maximum term is shorter than the headline, and a shorter term means a higher monthly payment for the same loan, which in turn reduces what the affordability calculation will allow.

Pension income counts, provided you can evidence it. An occupational or State pension in payment is income like any other for these purposes, and a buyer already retired is not unusual here. Income you expect to receive in future is a different matter: a bank assesses what you have now, so a term that runs past your retirement date will prompt questions about how the payments will be met once the salary stops.

Where Irish buyers end up, and what it costs

Irish buying on the Costa del Sol is not spread evenly along it. In our experience it concentrates in particular pockets, where people buy near friends and family who went before them and the same few developments come up again and again. There is a practical upside: in a building or urbanisation the lenders already know, valuations are supported by recent comparable sales and the file tends to move faster. There is also a risk of paying for familiarity rather than value, which is a reason to have the likely valuation sounded out before you sign a reservation contract. We cover the whole coast, from Fuengirola and Mijas to Marbella and beyond.

On costs, Andalucía charges 7% transfer tax on a resale, or 10% VAT plus 1.2% stamp duty on a new build, plus notary, registry, legal fees and the valuation: budget around 9–11% on a resale and 12–14% on a new build, in cash, on top of the deposit. See the full cost breakdown. Allow four to eight weeks from a complete file to a binding offer. Lending is governed by Ley 5/2019, which bans tied product sales while permitting bundled offers that must also be quoted to you separately, and we act as an independent intermediary, no vinculado, paid by lender commission on completion rather than by you.

Questions Irish buyers ask us