Buying a repossessed property directly from a Spanish Bank can be an attractive option, mainly because there are some great deals to be had and at the right price. One thing though, don’t expect to see a glossy brochure or professional photos, and some of these properties could have been vacant for a few years so expect some work to be done.
Pros & Cons of Buying a Repossessed Property in Spain
One of the main points and benefits of buying a repossessed property in Spain is the low interest rates, and with some of the banks it can be possible to arrange finance up to a 100% while others may offer the standard to foreigners which is 70%
One drawback to be aware of is when a property in Spain is sold any debts attached to that property will stay with the property and not the previous owner so make sure you or your representative do your due diligence and check the land registry for any outstanding debt otherwise you could get more than you bargained for!
Some of the properties may have been empty for years so may not be in a very good condition, also some of the previous owners having being evicted may have stripped the place bare. Repossessed homes can be sold for the outstanding debt owed to the bank but in some cases banks will want to get the best price they can. Some of the Spanish banks will consider offers for their repossessions whilst others will have a firm selling price.
With regard to negotiations and price it can depend how many people are interested in the same property that you are, if there are many potential buyers you could end up in some sort of bidding war which is best avoided.
To view a repossessed property the banks will either use an estate agent as a third party or they may have their own viewings department, either way you will pay the same price regardless of who you view through. If viewing through the appointed agent should you buy then the agent will get a commission from the bank of around 1% or 2% You should also be aware that the estate agent will probably try to sell you one of their own properties as they will have a lot more commission in their own properties than the banks.
Bank managers have access to information about people failing to pay their mortgage instalments and so will know about the newest homes that have been repossessed or are soon to be repossessed, so if you are interested in any particular area you should call into the various banks and ask them for the latest repo listings or better still get to know the manager on a friendly basis. The managers and bank employees have direct contact with the banks headquarters for submitting bids so they can help you.
Top Tip: Not all repossessed properties are online. Check with the Spanish branch of the area you are interested in to see if they have any new offers.