Mortgage regulation in Spain continues to be a significant topic of discussion. Despite being nearly three years since the ‘Ley Hipotecaria’ was introduced, banks are still grappling with compliance. The Bank of Spain is transitioning from the implementation phase to the regulatory phase, focusing on monitoring regulated entities and clamping down on unregulated intermediaries.
How does mortgage regulation affect non-euro earners?
The mortgage law has notably impacted the range of products available for non-Euro earners seeking finance in Spain. To protect consumers from exchange rate risks, banks must offer clients the option to convert their mortgage from Euros to their earning currency if the exchange rate differs by more than 20%. This regulation has led some banks to withdraw products for non-Euro earners, while others have modified their offerings.
Mortgage regulation options in Spain for non-euro earners
Most banks have now determined which currencies they are comfortable with. As of now, both variable and fixed-rate mortgages are still available to clients earning in major currencies. However, high-net-worth (HNW) clients earning in less common currencies may face challenges, as many Spanish banks do not accept these currencies.
Solutions for High-Net-Worth clients
Private lenders, many of which are located outside of Spain, offer a viable solution for HNW clients earning in currencies not accepted by Spanish banks. These lenders are not subject to the same regulations, providing more flexibility for clients.
Looking ahead
As travel continues to open up, we expect further developments in this evolving situation. We will keep you updated on how these changes impact mortgage regulation in Spain.
For more information or to discuss your mortgage needs, feel free to contact us.
Complete my private wealth assessment form