Mortgage expenses – everything you need to know

Buying a house implies doing many numbers so as not to stay at zero and to be able to face all the expenses of the mortgage; Therefore, we must be aware of the needs of our home, our tastes and, above all, know what are the round numbers that will lead us to the house of our dreams. Keep reading, we explain the mortgage expenses.

Mortgage fees – processing fees

Buying a house implies facing two types of processing costs: the first derived from the sale itself and the second (and not least) an expense for granting the loan at the bank. These two amounts will reflect, in the smallest of cases, 10% of the total value of the home.

In addition, you must bear in mind that banks do not grant 100% of the total amount of the mortgage and it will depend on your income, the linked products contracted and some other aspects that will increase the usual 80% of the amount lent by the bank, being able reach 90% in the best of cases (with all these elements subrogated to keep them with the bank).

Mortgage expenses: what are the expenses of formalizing a mortgage?

When signing the binding contract with the bank to formalize the mortgage, there are a series of expenses that we must face to face the financing of the home, among which the appraisal expenses, the notary expenses, the expenses of registration and registration fees for real estate. We will explain you.

Appraisal Expenses: The most important initial mortgage expense

Second-hand homes measure their current value by the use that has been made of them and, on the other hand, by the location in which they are, as well as by their characteristics (square meters, number of rooms, amenities …). These factors are what lead us to carry out, prior to the purchase, an appraisal by a company external to the bank or a company chosen by the future buyer of the same, in which the value of the home is studied in Based on these points and on market studies of the value of the neighboring properties, generating appraisal costs of not less than € 300 on average, which allow the bank to calculate the mortgage to be granted. These appraisal expenses are always borne by the buyer.

Notary fees: necessary mortgage expenses

Our future must be ratified by a notary to attest to the sale and purchase operation and the future deeds where all the details of the real estate operation are reflected. Thus, this amount may vary according to the notary according to the limits required by the Government. These notary fees are paid by the bank.

Registration fees: validate our future home

In each autonomous community there is a Property Registry in which all the homes in each municipality are uniquely registered, registration costs set by law and that depend on the total value of the appraised home that will allow us to ensure the property of the House. The registration fees are paid, in this case, by the bank.

Management expenses: intermediate expenses

Many people do not know exactly what the management expenses consist of and they are unaware of the intermediate procedures that the formalization of a mortgage entails, such as the withdrawal of copies of the notary’s office, the settlement of taxes and the presentation and withdrawal in documents of the Registry of the property. These mortgage expenses are assumed by the bank.

Mortgage expenses: other added expenses

To all these expenses are added regional taxes of a state nature such as the Tax on Documented Legal Acts , between 0.5 and 1.5% of all expenses to pay on the mortgage. In addition, we will find mortgage cancellation and subrogation expenses, the first, known as early repayment commissions, are set by law based on the mortgage contracted, if applicable a fixed mortgage of 2% for the first ten years and from here on 1.5%, while in variable mortgages it will depend on the Euribor with minimum and maximum limits (so that neither the bank nor the owner loses). The second concept, the mortgage subrogation expenses, establishes the payment of future losses of the bank from which we left to another bank, according to the commissions applied by the bank, the end of the operation and the date of signing of the mortgage.

Grupo Mar de Casas, we help you understand your mortgage expenses

At Grupo Mar de Casas we have a team of expert real estate agents who will help you find your ideal home at Madrid, Murcia, Alicante and Almería and to understand your mortgage expenses, your buying and selling process will be much easier, trust us your future home, you will not regret.