LBS real estate financing in Spain: pros and cons - CPH Invest GmbH

LBS Real Estate Financing in Spain: Pros and Cons – Today I would like to make a recommendation. For a business partner who knows what he is talking about. Who is really familiar with real estate financing in Spain. And from my own personal experience. Because he has a holiday home in Spain himself. And therefore knows all the pitfalls of real estate financing in Spain. And I’m talking about my really good business partner Michael Thomae from the LBS Baden-Württemberg.

Real estate financing with LBS in Spain

Basically, I recommend the LBS to non-residents living in Germany. Because the biggest problems with Spanish banks are related to communication. The German customer is not used to the excessive bureaucracy. And it is often still not possible to sign all documents online at Spanish banks. Or the online access does not work. Or something else doesn’t work. The rule is actually: something doesn’t work. Which does not work? You can’t say that beforehand. But everything going smoothly is out of the question.

This is where the LBS stands out in a pleasant way.

Advantages of real estate financing with the LBS in Spain

For me, the decisive advantages of real estate financing with LBS in Spain are:

1. Financing can also be started after the notary appointment. Sounds logical at first. But when you know that Spanish banks never finance after a notary appointment, you see the advantage: often there is simply not enough time to get everything done to the point. Then it is reassuring when you have a German financing commitment in your pocket and buy first and then issue the mortgage after the notary appointment.
2. Funding can also be included for renovations. And completely unbureaucratically: an appraiser determines the market value of the property. Basically you get 50% credit on this value. Unthinkable for Spanish banks.
3. Financing can also be included for inheritances, gifts, etc. Here, too, the procedure is the same as for the renovation loan.

Of course, not everything is perfect here either. Where would it be there? There are downsides too.

Disadvantages of real estate financing with the LBS in Spain

The biggest restrictions on real estate financing with the LBS in Spain are:

1. no construction financing. The property must be completed. And have the appropriate permits. In particular, the extract from the land register is checked very carefully.
2. no financing of a primary residence. If you are planning to emigrate to Spain, forget the LBS. This requires a place of residence in Germany and income there that is taxed in Germany.
3. Financing only up to 50% of the purchase price. This is perhaps the biggest limitation compared to Spanish banks. These finance up to 60%.

But what you should really pay attention to before you submit a financing application to the LBS

Perhaps the most important point for successful real estate financing in Spain: local competence. The valuation report is not a sure-fire success. And a bad appraisal, carried out incompetently, is unfortunately more the rule than the exception.

And that’s exactly why I recommend competent advice before you submit your loan application. You can get it from Michael Thomae.

You should therefore think of the loan from the end – the money in your account – and under no circumstances take the next best advisor!

Sure, you will find LBS customer advisors at the savings banks. And there are many sales representatives who offer LBS products. The only problem: real estate financing with the LBS in Spain is of course a niche product. And of course the devil is in the detail when it comes to financing with the LBS.

Not every consultant can and wants to get used to it optimally.

Common mistakes are information that is wrong – often out of ignorance. Consequence: the application for financing falters. Or contradictory information was given. The bank estimate did not bring the desired result or was – Attention! – never executed. The case got lost somewhere in Spain. If the customer advisor does not speak Spanish and is not familiar with local customs, failure is actually programmed.

Hence my request to you, dear readers: before you contact LBS, please think about real estate financing from the end. The end here is the disbursement of the loan. And that requires a notary appointment in Spain.

Do you have questions about real estate financing in Spain?

Would you like to know the advantages of on-site financing? Is it worth financing with the bank instead of using equity? Here we give the answer. Is hire-purchase an interesting option? You can find out here . Or maybe a bridge financing ? Who knows about notary appointments in Spain? How do you use the house bank optimally for your financing? Of course we at CPH Invest. After all, we have been offering this service for over 20 years. Your advantage: You can get financing faster. And our service doesn’t cost you a penny extra.

So. What are you waiting for? Submit your request for LBS real estate financing in Spain here.