Mortgages covering 100% of the total finance required were easy to come by before the property crisis. Then, they became a long-distant memory of the past as banks also veered on the verge of collapse. Just a few years ago customers were lucky to be granted 60 or even 70% of the finance they required to purchase a property.
However, the real-estate sector is in recovery; no one can deny that anymore, and banks are lending again, although not to the same extent as before.
The norm now, in many cases, is to be given a maximum of 80% of the property valuation amount in exchange for high interest rates and strict conditions – unless the client is extremely solvent and under no risk of not being able to repay the loan.
However, banks have relaxed their conditions and are now even competing against each other in a bid to gain the most amount of new clients. This means that new and very interesting offers are being launched on to the market at a fairly rapid rate.
Now, the latest step forward by just a minority of entities is the return of the 100% mortgage – offers that give the client 100% of the money they require to make their purchase.
Ibercaja
Ibercaja has launched its latest offer called Superhipoteca 2014, which does guarantee the client 100% finance. The loan can also be paid back over 40 years and the interest rate is 3% for the first year and 2% over the Euribor afterwards.
To qualify for this mortgage deal, the client must fulfil the following:
- Pension or wages to be paid into an Ibercaja account
- Three direct debits for bills to come out of the account
- Take out the multirisk Ibercaja Hogar house insurance
- Take out a similar life insurance
- Make purchases with an Ibercaja credit card
- Maintain a minimum amount of money set by the bank in the account at all times
- Invest money in a fund managed by the bank
- There are two years of interest-only payment offered
Caja Ingenieros
This bank has launched the Hipoteca Hogar which offers finance of 80% or more, in some cases reaching 100% of the purchase price of the property. The interest rate is higher at 4.5% during the first year and 3.5% after. With extras taken out this can be reduced to 2.74% over the Euribor.
For this offer, the client must:
- Have wages or pension paid into the account
- Take out a product to the value of 3,000 euro or more
- Take out life insurance
- Home insurance
- Payment protection insurance
Although the general current norm is for banks to offer a maximum of 80% of the valuation amount, some are actually willing to negotiate and enter into discussion if more is required, although this is not widely advertised. However, others do say that all cases will be considered once all the necessary documentation has been handed into for study.
Source: www.cincodias.com
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