Why is Private Banking relevant in Spain? During 2019, Spain introduced new mortgage legislation, La Ley de Crédito Inmobiliario (The Law of Real Estate Credit). The legislation followed the implementation of the EU-wide Mortgage Credit Directive aimed at providing higher levels of consumer protection and introducing common principles throughout Europe.
Whilst we welcomed its introduction, many banks started to apply stricter affordability criteria, which meant some High Net Worth and Ultra High Net Worth clients were no longer eligible for Spanish mortgages. We also recognise that for some clients, a Spanish mortgage does not necessarily fit their requirements, as they often seek to leverage their purchases using Assets Under Management (AUM) as additional guarantees, therefore allowing them to finance up to 100% of the purchase price.
At Mortgage Direct we work with a network of global private banking lenders who are able to provide bespoke mortgage solutions for your purchase in Spain.
Financing 100% of the purchase price can have other tax advantages. We therefore always recommend that our clients seek independent professional advice before committing to private banking mortgages. At Mortgage Direct we have excellent contacts with law firms, tax advisers and other specialists in the luxury property sector who are at your disposal should you wish to use them.
The private banking product types available
Private Banking products are designed around your needs, but see below an indication of the types of product that are available:
- Personalised service from both the Mortgage Direct Premier Service team (and the lender)
- Finance at up to 100% LTV, 60% LTV over the property and an additional 40% by holding AUM with the lender.
- Interest-only or capital repayment.
- Lombard facilities available.
- Fixed or variable interest rates.
We understand that each client has unique requirements. Our High Net Worth and Ultra High Net Worth team is headed up by Kevin Monger and Howard Steel. Both Kevin and Howard have had long careers in financial services and are highly knowledgeable when it comes to assessing private banking client profiles, showing an instinct for which product and lender would be most suited to each profile.
We look forward to assisting you with your purchase in Spain.