Deposit and LTV: How Much Can a Non-Resident Borrow in Spain

How much can a non-resident borrow in Spain?

If you are a foreign buyer looking at a new-build home on the Costa del Sol, the single most important number is your loan-to-value (LTV): the share of the purchase price a Spanish bank will lend you. As a non-resident you will borrow less than a Spanish resident would, which means a larger deposit and more upfront cash. This guide sets out realistic LTV limits, the deposit you should budget for, how banks assess affordability, and the taxes and fees that sit on top. Figures reflect the market and Spanish rules as they stand in 2026.

Non-resident LTV limits: 60 to 70 per cent is the norm

Spanish lenders treat non-residents as higher risk, so the LTV they offer is lower than the 80 per cent a resident can often reach. In 2026 the standard limits are up to 70 per cent for buyers with EU or EEA tax residency purchasing a second home, and typically 50 to 60 per cent for buyers from outside the EU, which since Brexit includes UK nationals ¹⁶. A minority of stronger EU profiles buying a genuine primary residence may see up to 80 per cent, and a few offers stretch towards 75 per cent, but you should plan around the 60 to 70 per cent band rather than the exceptions ¹⁶.

Crucially, the bank lends against the lower of the purchase price and its own valuation (tasación). If the valuation comes in below the price you agreed, your LTV is applied to that lower figure and your cash shortfall grows. Always confirm whether an advertised LTV is measured on price or on valuation.

Your deposit: 30 to 40 per cent, plus costs on top

Because non-residents borrow 60 to 70 per cent, the mortgage deposit is the mirror image: expect to fund 30 to 40 per cent of the price from your own resources ⁶. That is only part of the cash you need. On a new build you must also pay purchase taxes and transaction fees, which typically add 10 to 13 per cent of the price ⁶.

A worked example on a 400,000 euro new-build apartment, assuming 70 per cent LTV for an EU buyer:

A non-EU buyer on the same property at, say, 60 per cent LTV would need roughly 40,000 euro more in deposit. See our related guide on buying costs and taxes for the full breakdown of transaction fees.

How Spanish banks assess affordability

LTV tells you the maximum loan against the property; affordability tells you whether the bank will actually grant it. Spanish lenders apply a debt-to-income (DTI) test: your total monthly debt payments, including the new Spanish mortgage and any existing loans, should not exceed around 35 per cent of your net (after-tax) monthly income ⁶. Some banks stretch to 40 per cent for very strong profiles, but 35 per cent is the working threshold ⁶. Note that Spanish banks assess on net income, not gross salary, which often surprises buyers used to gross multiples at home.

On a practical level, if your net monthly income is 5,000 euro, your combined monthly debt should stay under about 1,750 euro. Lenders will ask for pay slips or accounts, tax returns, bank statements and a credit report from your home country, and they will want to see stable, documented income in a major currency.

Term, age and interest rate

Non-resident mortgages usually run 15 to 20 years, shorter than the 25 to 30 years offered to residents, and the loan must normally be repaid by the time the oldest borrower turns 75 ¹. In 2026, with 12-month Euribor sitting near 2.3 per cent, variable offers are commonly Euribor plus a spread of about 1.5 to 2.5 per cent, while fixed rates run roughly 3.8 to 4.5 per cent for EU buyers and 4.3 to 5.2 per cent for non-EU buyers ¹. A shorter term and higher rate both raise the monthly payment, which feeds straight back into the DTI test, so a lower headline LTV sometimes matters less than the term you can secure.

Who pays the mortgage costs

Since a Spanish Supreme Court ruling and the mortgage law of 10 November 2018, the lender, not the borrower, pays the stamp duty (AJD) on the mortgage deed, along with the mortgage deed notary, the Land Registry fee for the mortgage, and the bank’s own gestoría costs ⁵. As the borrower you are generally left with the property valuation, which runs about 250 to 600 euro, and any arrangement or opening fee the bank chooses to charge ⁵. Do not confuse this AJD on the mortgage (paid by the bank) with the AJD on the purchase deed of a new build (paid by you), covered below.

Taxes on a new-build purchase

New-build homes are subject to IVA (VAT), not the ITP transfer tax that applies to resale property. On the Costa del Sol the figures are:

• IVA at 10 per cent of the price for standard new-build homes (reduced to 4 per cent only for special-regime protected housing, VPO) ⁴.
• AJD (Actos Juridicos Documentados) at 1.2 per cent, the general rate in Andalusia since 28 April 2021 under Ley 5/2021 ⁴.

That is a combined 11.2 per cent in tax on a standard new build, before notary, Land Registry and legal fees. Reduced AJD rates exist for a primary residence under value thresholds (for example lower rates for buyers under 35 or for large families), but these rarely apply to a non-resident second home ⁴. Our guide on IVA and AJD on new builds covers the detail.

The taxes you pay while you own

Owning as a non-resident brings two recurring obligations. First, the municipal IBI (property tax), billed annually by the town hall and based on the cadastral value. Second, IRNR (Impuesto sobre la Renta de no Residentes), filed on Modelo 210 ⁷.

If you do not let the property, you still pay tax on a notional “imputed” income. The taxable base is 1.1 per cent of the cadastral value where that value has been revised within the last ten tax periods, or 2 per cent otherwise, and the rate applied is 19 per cent for residents of the EU, EEA, Iceland, Liechtenstein and Norway, or 24 per cent for everyone else ³. This imputed-income return is now filed annually, with the deadline falling on 31 December of the year after accrual ³⁷. If you let the property, you instead declare the rent: 19 per cent for EU/EEA residents (who may deduct allowable expenses) or 24 per cent gross for non-EU residents, although a 2025 Audiencia Nacional ruling has begun extending expense deductions to non-EU owners too. See our dedicated guide on IRNR and Modelo 210.

When you eventually sell: the 3 per cent retention

Plan your exit before you buy. When a non-resident sells Spanish property, the buyer is legally required to withhold 3 per cent of the sale price and pay it to the Agencia Tributaria on Modelo 211, as a payment on account of the seller’s capital-gains tax under IRNR ². You reclaim any excess through your own Modelo 210 capital-gains return. It is not an extra tax, but it does mean 3 per cent of your sale proceeds is held back at completion, so factor it into your equity planning.

Practical steps to a stronger borrowing position

• Get your NIE early. You cannot complete a purchase or open a resident-friendly bank account without a NIE (foreigner identification number).
• Prepare a clean documentation pack in advance: tax returns, pay slips or accounts, bank statements and a home-country credit report. Clean, translated documents speed up approval and can improve the LTV offered.
• Get an Agreement in Principle before you reserve a unit, so you know your real LTV and monthly payment rather than an advertised maximum.
• Budget the total cash requirement: deposit plus 10 to 13 per cent costs, not just the deposit. Undercounting the taxes is the most common reason a purchase stalls.

The headline to remember: as a non-resident you are borrowing 60 to 70 per cent at most, funding a 30 to 40 per cent deposit, adding 10 to 13 per cent for taxes and fees, and proving your repayment stays under roughly 35 per cent of net income. Get those four numbers right and the rest of the Costa del Sol buying process becomes far more predictable. This guide is general information, not tax or financial advice; confirm your own position with a licensed Spanish mortgage broker and a tax adviser before committing.