BBVA Group Mortgage

The BBVA Group Mortgage is a loan for Spanish residents whose income and assets are exclusively in euros.

To apply for a mortgage, you must have a damage insurance policy for the mortgaged property for the duration of the mortgage. The insured amount must match the appraisal value (not including the land value). The insurance policy (which you do not have to take out with BBVA) must cover any damages to the property caused by fire, explosions, or natural causes. The bank must appear on the policy as the beneficiary of the outstanding amount.

You also need to have a checking account with BBVA. This account will be used for any transactions associated with your mortgage, such as deposits and direct debits. Please see the pre-contractual information for all the information on account administration and maintenance fees.

Please note that the granting of a mortgage is subject to authorization by the bank.

Yes, you can pay off your mortgage early in part (minimum €300) or in full. In addition to the amount you want to repay, you will have to pay interest and an amount as compensation for the early full or partial repayment that is equivalent to the financial loss that the Bank may sustain, and which may be, in the case of a Variable Rate mortgage:

• In the first 5 years: with a limit of 0.15% of the principal repaid in advance.
• From the 6th year (inclusive): 0% of the principal repaid in advance.

And if the mortgage is Fixed Rate:

• In the first 10 years: with a limit of 2% of the principal repaid in advance.
• From the 11th year (inclusive): with a limit of 1.5% of the principal repaid in advance.

Remember that before doing so, you have to read the information we will provide you, which details the consequences of each of the payments so that you can evaluate each of the options. You have to request the information 30 days in advance at your BBVA branch.

The NIR (Nominal Interest rate) is what you pay to a bank in exchange for receiving a loan. The NIR is usually less than the APR and is not useful for comparing the prices of different mortgages, since it only includes the interest rate and not all the transaction fees.

The APR (Annual Percentage Rate) provides the cost of a financial product, such as loans, and includes both the interest and the various costs and fees associated with it. This figure lets you compare different mortgages, because the lower the APR, the cheaper the mortgage.

Buying a property involves two types of expenses: those associated with the mortgage loan and others with purchase and sale transactions.

Mortgage loan expenses are paid by the bank: registration, notarial fees, processing and stamp duty. The process is a bit different in the Basque Country where regional regulations require the buyer to pay the stamp duty.

Purchase and sale expenses have nothing to do with the mortgage. Therefore, the bank is not responsible for paying them. These include the following expenses: Taxes (e.g., property transfer tax, VAT, and inheritance tax) and management, notary public, and registration costs.

The appraisal is usually paid by the buyer.

Please consult the following documents for all the basic information on our mortgages:

• Pre-contractual Information Sheet (FIPRE)
• Supplementary pre-contractual information (DIPREC)
• Informative poster

Your BBVA adviser will also answer all your questions and accompany you throughout the process. Once you have submitted the documents needed to perform the economic study and we have completed the feasibility study, your adviser will give you the European Standardized Information Sheet (ESIS).

They are calculated using the French repayment system. This calculation system makes the monthly payment as constant as possible. It can only vary if the interest rate changes or if you make early repayments.

To calculate the payments with this system, we use the following formula: (C*i/m)/(1-(1+i/m)^(-m *n), where C is the principal, i is the annual nominal interest rate, m the number of annual payments and n the years over which you're going to repay the loan. 

Let's look at an example using the formula. If you have a €150,000 loan at an annual interest rate of 2.50% and you repay it monthly (12 installments a year) for 25 years, each monthly payment will be €672.93. 

Here is the formula, with the sample figures: (150,000x0.025/12)/(1-(1+0.025/12)^(-12x25) = €672.93

With each installment, you pay off part of the interest and the principal on the loan. If you want to know how much each amount represents, you can calculate it as follows:

• To calculate the interest of each installment, divide the interest rate by the number of annual payments and multiply it by the amount borrowed.
• To calculate how much principal you're paying back (amortization), subtract the interest from the monthly amount.

We remind you that in the type of system we use (French repayment system), more interest is paid in the first installments and less in the last.

If you don't make your mortgage payments, you could lose your home. Remember that the mortgage holders must respond to BBVA with all their assets and rights, current or future. If another person provides a guarantee (e.g., a guarantor), they will have the same responsibility as the mortgage holders, unless otherwise indicated in the contract. 

Remember that when you take out a mortgage, you establish a relationship with the bank. This relationship comprises two elements: The main loan agreement and the mortgage. Let's take a closer look at these terms:

• Main loan agreement: this document is produced when a financial institution (the creditor) lends an amount of money to someone (the debtor). 
• Mortgage: The debtor (or another person) offers property as a guarantee that the loan will be repaid. Therefore, if the agreed payment commitments are not fulfilled, the bank can sell the property in a public auction to collect the amount owed. If the sale results in excess money, this amount is used to pay other creditors or, failing this, the debtor.