Friday, August 25, 2006

Remortgages and Valuations

Many of our clients are now sitting on a huge pile of equity after having bought in the last five years and seeing the appreciation in the rising Spanish market meaning they made a good little investment and a tidy sum. Spanish banks are finally waking up to the fact that there is equity in these houses and they can get some business from it and they are now willing to release that equity, usually by taking the mortgage from another bank. You have to pay an early redemption fee, usually one per cent of outstanding amount, but the savings to be made on a monthly basis by extending the time period while increasing the capital available for making improvements to the property or just to put away for a rainy day or invest in a second property or an off plan development means that a lot of people are now considering it.
We at Valencia Property have been arranging many of these deals for our own clients and others coming in to take advantage of the equity release and despite the rising interest rates there are still good deals to be found. Typically we are finding rates at 4% for the first year and on ongoing rate of Euribor plus 0.75% for this type of deal.


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