Another buying a property question

Loftusrd1980

Active Member
I am hoping to buy a property here in the UK next March and with my partner have saved the 10% + deposit now required.

My question is that we also own a property over in Spain, the value is roughly 40000 euros (market is terrible at the moment and it has been on the market for a while. We are in no rush to sell so wouldnt take any less than 40000) we have a mortgage with Santander for 26000, payments per month are 175 euros so not much.

Do we need to delare to a bank here in the UK that we own the property? if we do will they take in to account the equity and not be concerned that we have a debt over in Spain or will they factor that in to the ammount they will lend us?

Thanks
 

jassco

Distinguished Member
Can you not just go into the bank and ask? Surely they're best informed to answer this question for you
 

mattclarkie

Distinguished Member
I assume the question was asked in the event the bank don't have to know, will it prejudice them to know it.

I'd assume owning an asset can only be a good thing, but banks are funny institutions.
 
Last edited:

FZR400RRSP

Banned
I'd assume owning an asset can only be a good thing, but banks are funny institutions.

But, as I understand it, the bank he's asking for a UK mortgage from won't have any rights over that asset?
If he fails to pay his UK mortgage, they can't touch that Spanish property (I don't think...)
So then the only issue is the cost of the Spanish mortgage, which he's said is EUR175 per month.
So they will make allowances for that cost when calculating his ability to pay his UK mortgage.
 

Loftusrd1980

Active Member
I did intially ask a bank if they would take in to account the equity in the Spanish property which they advised they could not, I just wondered if anybody had experience of this as I would not want to be penalised for having another property.
 

Loftusrd1980

Active Member
I'd love to know how many people actually answer this question truthfully.:D

I pay the mortgage via cheque in to a separate Spanish bank which somebody then pays in to Spains Santander for me.

I wonder as Santander is very previlant in the UK whether it can be tracked that I have a mortage in Spain meaning I need to declare it?
 

imightbewrong

Distinguished Member
Are you supposed to? Almost certainly.
Will they find out if you lie? Maybe - highly unlikely - unless....
Will they find out if I default? Probably, but then, what will they do.

The only reason not to mention it is if you are worried they will lend you less because you have committed outgoings - but then, wouldn't that be a good thing? :)
 

Loftusrd1980

Active Member
Are you supposed to? Almost certainly.
Will they find out if you lie? Maybe - highly unlikely - unless....
Will they find out if I default? Probably, but then, what will they do.

The only reason not to mention it is if you are worried they will lend you less because you have committed outgoings - but then, wouldn't that be a good thing? :)

My only issue with having to declare it is that I am only prenalised for having outgoings, it is not taken in to account (from the brief conversation I had with one bank) that I have equity in the property (well possible equity the market is poor in Spain :eek:)
 

FZR400RRSP

Banned
I wonder as Santander is very previlant in the UK whether it can be tracked that I have a mortage in Spain meaning I need to declare it?

I stand to be corrected, but I think it can only be classed as another outgoing.
Let's face it, the amount isn't great and most people pay more for their cars every month.
Other than your ability to pay, I can't see any other reason why another mortgage in another country would worry a UK lender.:confused:
 

imightbewrong

Distinguished Member
My only issue with having to declare it is that I am only prenalised for having outgoings, it is not taken in to account (from the brief conversation I had with one bank) that I have equity in the property (well possible equity the market is poor in Spain :eek:)

Why should the equity in the property count for anything in your favour? It's not liquid, so it's not going to be able to pay off this mortgage if you run into difficulties.
 

Loftusrd1980

Active Member
Why should the equity in the property count for anything in your favour? It's not liquid, so it's not going to be able to pay off this mortgage if you run into difficulties.

So it always deemed a liabilty and not an asset? I was under the impression that if you had equity in a property it was an asset.

I dont expect to use it as an asset to gain a better mortgage but I am concerned it will reduce my borrowing ability with a bank.
 

FZR400RRSP

Banned
So it always deemed a liabilty and not an asset?

I would say it's simply viewed as an 'outgoing'. (but stand to be corrected)
Same as if you spend £400 a month on a car.
All they care about is that you've got £400 going out every month.
For all they know, it could be a classic car worth a fortune.
They're not interested, they won't ask, all they care about is the fact you're committed to £400 a month.
 

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