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Banking In Spain

Banking In Spain

6. Other Bank Services

Standing Orders (domiciliación)

You can order the bank to regularly pay certain bills when they come due - local taxes, garbage collection, electricity, water, phone, subscription to FIPE - by filling in a form supplied by the bank or the business billing you. Both the bank and the billing business must be informed of this standing order. You must make sure that you have sufficient funds to pay such standing orders or you may arrive at your home to find essential services shut off for lack of payment (often requiring a reconnection fee!). Banks have been known to make mistakes resulting in the same unpleasantness! Do not expect to get anything free from the bank. Ask for their list of fees for various transactions (which must be approved by the Banco de España).

The Bank Certificate

It used to be obligatory for a foreigner to present a Bank Certificate if the money to buy a house came from outside Spain so that, under the then current control laws, you could take the money out of Spain if you wanted to. This is no longer necessary. But a foreigner applying for a residence permit as a retired person must get a certificate from the Spanish bank to the effect that he recieves regular pension payments from abroad.

Mortgages (Hipotecas)

A resident or non-resident foreigner may take out a mortgage in Spain, including on State-subsidized housing ("VPO" or Vivienda de Protección Oficial). You may use a Spanish or a foreign mortgage holder, and the mortgage may be in Euro or a foreign currency. A resident may finance up to the totality of the value of a property and over a longer period as a non-resident. Interests on mortgages in Spain are low. Variable interest mortgages can be had at 3-4% per annum, and fixed interest mortgages from 5%.

If you want to take a mortgage with variable interest, the best reference for the variations is the I.R.M.H. (Indice de Referencia del Mercado Hipotecario) published by the Banco de España or other called EURIBOR



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