Property Purchase: ROI Financing and Leverage

Key components

Mortgages

Financing is a key component of wealth enhancement and return on investment. With appropriate and cost-effective financing, investors can leverage their existing wealth to maximise returns or build a diversified portfolio of assets.

 

IPTW has established strong relationships with a variety of Spanish mortgage providers and international property financing specialists, facilitated by the quality of our clients and investment proposals. While many foreign property owners may not meet the criteria to secure a mortgage from a Spanish bank, we collaborate with various providers to source financing options, even in the most challenging scenarios.

 

Spain continues to demonstrate a strong and sustained recovery, particularly in its property sector, with increasing signs of liquidity returning to the mortgage market. However, financing options at the retail level typically cover only 60%-70% of the property’s value. Institutions often adjust their rates during marketing drives, and IPTW ensures you benefit from the best rates available.

 

Our team will prepare and manage the financing proposal, as well as collate and present the required personal and due diligence documentation needed by lenders. This meticulous approach enhances the likelihood of securing favourable financing terms.

 

If you are considering buying property in Spain or need assistance with financing your investment, please fill out the contact form below, and one of our experts will get in touch with you to discuss your options.

 

Key Components

Bridging Finance

The need for bridging finance varies and, in each case, is generally more complex than mortgage or refinancing scenarios. Bridging finance is always short-term (6–36 months), typically more expensive than long-term financing, and often required urgently. Common situations for bridging finance include:

 

  • Avoiding repossession or execution of a charge on a property.
  • Financing a purchase when a seller is committed to buying a new property, but their buyer pulls out at the last minute.
  • Providing short-term working capital for property developers to complete and sell a development.

Bridging financiers do not require the same level of proof of ability to repay or a perfect credit rating as traditional lenders. This is because the loan-to-asset value rarely exceeds 50%, and higher interest rates and charges compensate for the perceived risk. However, any applicant for bridging finance must present a clear financing proposal and exit strategy to gain approval.

Properties eligible for bridging finance can include residential, buy-to-let, semi-commercial, or fully commercial assets.

Key Components

FX Transactions

Moving money abroad can be expensive, especially when buying property that costs hundreds of thousands of euros. That’s why we work with a range of FX companies to ensure you always secure the best exchange rates for cross-border transactions.

 

Traditional banks often charge higher fees, while newer e-banks may have restrictions on transaction amounts. Our consultants work closely with you to understand your FX requirements and guide you through the process of setting up a specialist foreign currency account. This account allows you to hold funds with FX providers and transfer them on the day of your choosing, ensuring you benefit from the most favourable rates.

Contact Our team of advisors