Buying a house from the bank in Spain: what you are buying and how to finance it

On a Spanish bank's website, an apartment on the Costa Blanca is listed for 30 percent below the asking price of the neighboring property. You do the math quickly: that saves tens of thousands of euros. What you don't know at that moment is whether you can finance this house at all, what debts are attached to it, and whether you are dealing with a Spanish bank or a court.



After all, "buying from the bank" is not a single thing in Spain. There are three different processes, with different rules and different financing options. In one case, the bank is happy to help you with a mortgage. In the other, you must put the full purchase price on the table within twenty days. Below is an explanation of which process is which, what you can realistically borrow as a Dutch or Belgian national, and which accounts from the previous owner remain associated with the property.

Table of contents

1. Buying from the bank means three different things
2. Route 1: a property from the bank's portfolio
3. Route 2: the judicial auction via the BOE
4. What you can actually borrow as a non-resident
5. The valuation determines your mortgage, not the asking price.
6. The debts that move with the home
7. Will a bank-owned home still be a bargain in 2026?
8. What to arrange before making an offer
9. Frequently Asked Questions
10. Personal advice

Buying from the bank means three different things

In Dutch articles about Spain, bank repossession, auction, and bank home are used interchangeably as if they were synonyms. That is precisely where things go wrong, because the financing differs completely depending on the process.

The first stage involves the property that the bank now owns itself. The previous owner was no longer able to pay, the foreclosure has been completed, and the property is now on the bank's balance sheet. The bank is then simply the seller, just like any other seller, and sells through its own sales organization.

The second track is the judicial auction. In that case, the home is still owned by the original owner, and the court sells the property to settle the debt. The bank is the creditor there, not the seller.

The third track is the notarial auction, which occurs less frequently and plays a role primarily in divisions and certain types of debts. For most Dutch and Belgian buyers, it concerns the first two.

The difference is not academic. With the first process, you can apply for a mortgage just like with any other purchase. With the second, that is not possible in practice, and that is where most buyers run into trouble.

Route 1: a property from the bank's portfolio

Spanish banks do not sell their own real estate from bank branches, but via separate platforms and managers. Santander does so via Diglo, CaixaBank via BuildingCenter and Facilitea Casa, Sabadell via Solvia, and Abanca via Escogecasa. BBVA and a number of other parties have placed their portfolios with servicers such as Haya. Unicaja, Ibercaja, Bankinter, and Kutxabank also have their own real estate portals.

In practical terms, this means you won't get any further at a branch. The employee at the counter does not have access to that offer and refers you to the platform. Your offer goes through the administrator, not the bank itself, and the processing time is usually longer than with a private seller because the signing must be done internally.

This process is the one where you read in Spain that banks are financing their own homes more flexibly. On the Spanish market, it does indeed happen that a bank finances up to 90 or even 100 percent of a property from its own portfolio, with longer maturities than usual. This is attractive to the bank, because it sells an asset and takes out a mortgage.

Important to know: those offers are aimed at the Spanish housing market and at people who live and work in Spain. The sources mentioning these percentages say nothing about buyers living outside Spain. Therefore, as a non-resident, you cannot assume that you will receive the same conditions. What you can do, however, is find out whether the bank selling the property finances your profile and whether there is room above the standard range. That is a conversation you have before you make an offer, not afterwards.

Route 2: the judicial auction via the BOE

Since Ley 19/2015 of 13 July 2015, elaborated in Real Decreto 1011/2015 of 6 November 2015, all judicial auctions in Spain are conducted exclusively electronically via the Portal de Subastas of the Boletín Oficial del Estado. Anyone can watch along, including from the Netherlands or Belgium. An auction remains open for at least twenty calendar days.

The rules were tightened as of April 3, 2025, by Ley Orgánica 1/2025 of January 2, 2025. Two changes hit your wallet directly.

• The deposit required to participate in the bidding has been increased from 5 to 10 percent of the auction value, with a minimum of 1,000 euros (Article 647 LEC).
• The period for depositing the remainder of the purchase price has been shortened from 40 to 20 days after the closing of the auction (Article 670 LEC).
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Twenty days is too short for a Spanish mortgage application as a non-resident. Valuation, file preparation, approval, and the mandatory notarial advice do not fit within that timeframe. In practice, this means buying an auction property with your own funds, or with financing you have already arranged elsewhere, for example with assets from the Netherlands or Belgium. Anyone who makes an offer without collateral and misses the deadline loses the deposit.

There is also a floor to the price. If it concerns the primary residence of the previous owner, the court may, in principle, not award the property for less than 70 percent of the auction value. Only if the bid covers the creditor's full claim can a lower amount be awarded, with 60 percent as the lower limit (Articles 670 and 671 LEC). The image of a villa selling for a quarter of its value therefore does not correspond with the law.



Finally: at an auction, you buy what is there, in the condition it is in. You usually have no right to look inside, and the property may be occupied. Clearing it out is a separate procedure, with its own costs and timeframe.

What you can actually borrow as a non-resident

For a standard purchase in Spain, buyers who do not reside in Spain have a financing range of 60 to 70 percent. Those who are tax residents typically reach around 80 percent. That difference is not a point of negotiation but a structural characteristic of the Spanish banking system for this segment, and it applies even if the seller happens to be a bank.

So, count on a minimum down payment of 30 percent, plus buyer's costs. For a property of 250,000 euros, that easily means 75,000 euros of your own money for the purchase itself, plus another 10 to 12 percent for taxes, notary fees, registration, and lawyers. You can calculate exactly how much this is in your situation using the mortgage calculation tool, and what counts as equity is explained on the page regarding equity for a Spanish mortgage.

Furthermore, a Spanish bank looks at your monthly expenses. The rule of thumb applied by Spanish banks is that your total housing costs, including your Dutch or Belgian mortgage, should not exceed approximately 35 percent of your net income. Consequently, buying a second home while your first mortgage is still outstanding directly impacts what you can borrow in Spain.

The valuation determines your mortgage, not the asking price.

This is the point where most bank home plans fall apart, and it is rarely mentioned in articles about bank repossession.



A Spanish bank does not calculate the financing rate based on the price you pay, but on the lower of two values: the appraisal value or the purchase price. If you buy a home for 180,000 euros while the appraiser arrives at 160,000 euros, the bank calculates its 60 to 70 percent on that 160,000 euros. You then borrow a maximum of 112,000 euros instead of the 126,000 euros you were counting on, and you have to pay the difference of 14,000 euros yourself.

This occurs more frequently with bank-owned homes than with private sales. The asking price is determined by the selling party based on their own book value and sales target, and this does not necessarily align with what an independent appraiser assigns to it. This can go two ways. If the appraisal turns out higher than the asking price, the asking price is leading and you have no room for maneuver. If the appraisal turns out lower, that is entirely your problem.

The practical lesson: have your financing capacity determined before making an offer, not afterwards. Especially in Spain, where the preliminary purchase agreement is much stricter than Dutch buyers are used to. Article 1454 of the Spanish Civil Code stipulates that in the event of default or a down payment, the buyer can terminate the agreement by forfeiting the down payment, and the seller by having to repay double the amount. A financing clause, as is standard in the Netherlands, is not included as standard. If your mortgage does not go through, you lose your down payment unless you have agreed otherwise in writing beforehand.

The debts that move with the home

A property that has stood vacant for years or whose owner was in financial difficulties often carries a trail of unpaid bills. In Spain, part of these remain attached to the property, not to the previous owner.

Arrears in contributions to the homeowners' association are the best-known example. Article 9.1.e of the Ley de Propiedad Horizontal stipulates that the property serves as security for the part of the year in which you purchase it that has already elapsed, plus the three preceding calendar years. This period was extended from one to three years in 2013 by Ley 8/2013 of June 26, 2013. In a complex with high monthly contributions, this can amount to a substantial sum, and the association can recover the debt from the property.

Something similar applies to the property tax, the IBI. Article 64 of Real Decreto Legislativo 2/2004 stipulates that the real estate is liable for the payment of the full tax debt, under a system of subsidiary liability. The municipality therefore first pursues the previous owner, but if the latter fails to pay, it can still recover the debt from the property.

In addition, there may be entries in the land registry that predate the mortgage being foreclosed. These do not disappear with the auction. A current extract from the Registro de la Propiedad, the nota simple, shows what is registered. Requesting this costs a few euros and is the cheapest insurance in the entire process.

Information regarding additional transfer tax, notary fees, and registration costs can be found on the page about buyer's costs for a property in Spain. Please note that transfer tax varies by region and changes regularly.

Will a bank-owned home still be a bargain in 2026?

The idea of dirt-cheap bank homes stems from the aftermath of the real estate crisis, when Spanish banks held enormous numbers of properties on their balance sheets and wanted to get rid of them. That image has stuck, but the market underneath has changed. Portfolios have been sold to specialized managers focused on yield, and Spanish house prices have risen sharply in recent years.

That doesn't mean there is nothing to be gained. It means that nowadays, the profit lies elsewhere than in a spectacular discount on the asking price. Where you make the difference:

• For a property from the bank's portfolio, the selling bank may be willing to arrange the financing itself, which makes the application shorter and more certain.
• A seller who wants to take property off their balance sheet is often more flexible regarding the completion date and minor defects than a private individual who is emotionally attached to their home.
• Properties that have been in the portfolio for a long time are periodically discounted. That is a matter of timing, not negotiation.

Where you *don't* make the difference: bidding at an auction without having the full purchase price ready. That is not a shrewd purchase; that is a risk of a 10 percent deposit plus the time you put into it.

What to arrange before making an offer

The order is more important with this type of purchase than with a regular purchase, because you are dealing with short response times for both the bank portfolio and the auction.

• Apply for your NIE number. Without this tax number, you cannot register a property in your name or take out a mortgage in Spain.
• Have your borrowing capacity determined in advance, based on your income and existing expenses. This gives you an amount to count on, rather than just hoping for.
• Request the nota simple from the Land Registry and have it reviewed by an independent Spanish lawyer before you sign anything.
• Request a statement from the homeowners' association regarding outstanding contributions, and from the municipality regarding outstanding IBI.
• Find out which bank sells the property and whether that bank finances your profile. The page about banks in Spain lists the differences between the major players.
• Include buyer's costs in your budget, not as a final item.

Frequently Asked Questions

Can you finance a property from a Spanish auction with a mortgage?

In practice, no. Since April 3, 2025, you must deposit the remainder of the purchase price within twenty days of the closing of the auction (Article 670 LEC). A Spanish mortgage application as a non-resident takes longer than that, including valuation and the mandatory notarial consultation. Therefore, for an auction, you must have the purchase price available, or financing that you have already arranged elsewhere.

How much of your own money do you need for a bank-owned home in Spain?

For a property from the bank portfolio, the same range applies as with any other purchase: as a non-resident, you typically finance 60 to 70 percent, meaning a minimum of 30 percent down payment plus 10 to 12 percent buyer's costs. For an auction, you require a 10 percent deposit to be eligible to bid, followed by the full remainder within twenty days.

Is it true that Spanish banks finance their own homes up to 100 percent?

That occurs on the Spanish market. The offers in question are aimed at buyers who live and work in Spain. For buyers from outside Spain, this is not a given. Check with the selling bank for each property, and do not rely on what is stated in general Spanish articles.

Are you taking over the previous owner's debts?

Not personal, but a portion remains attached to the property. For arrears in contributions to the homeowners' association, the property serves as security for the current year plus the three preceding calendar years (Article 9.1.e Ley de Propiedad Horizontal). For unpaid property tax, subsidiary liability applies via Article 64 of Real Decreto Legislativo 2/2004.

Can you view an auction home in advance?

Usually not. At a judicial auction, the property still belongs to the original owner, who is not obliged to let you in. Therefore, you are buying based on the information in the auction file and the land registry, and not on what you have seen.

Do you lose your down payment if the mortgage doesn't go through?

If arras have been agreed without an additional agreement, then yes. Article 1454 of the Spanish Civil Code stipulates that the buyer may terminate the agreement by forfeiting the down payment. A financing clause is not standard in Spain. If you want that protection, it must be explicitly included in the contract before you sign.