Paying off a Spanish mortgage
Discussion
Afternoon....my dad bought a small apartment in Spain many years ago and took a small mortgage with Sabadell...he's now sold it to me and I've been trying to pay off the mortgage since may this year...the money's been sat in my dad's Spanish bank account since then but it's been a nightmare trying to pay off the outstanding balance, it's as if they've never come across this situation before. They're now talking about us both having to go over and sign a document bin front of a power of attorney....what a ballache....has anyone had a similar experience not got any tips/advice please?
Many thanks Craig
Many thanks Craig
My Spanish mortgage was with Sabadell. We paid it off without any issues although the bank needed to know where the money ws sourced.
If you are paying it off why is the money sat in your Father's account? Was the apartment legally sold to you or is it still in your father's name? Sounds a bit odd.
If you are paying it off why is the money sat in your Father's account? Was the apartment legally sold to you or is it still in your father's name? Sounds a bit odd.
Eh? The property has an o/s mortgage in my dad's name...to transfer to my name id either have to pay off the mortgage or take a mortgage in my name....I get it's not the normal way to do things, to pay off the mortgage before transferring title, but I'm confident my dad's not going to rip me off...
Do you formally and legally own the house? If so, presumably the charge has been released?
How did the charge get released without the bank receiving proceeds to satisfy the mortgage?
i.e. how was there a transfer of ownership to you with a mortgage remaining outstanding in your dad's name?
How did the charge get released without the bank receiving proceeds to satisfy the mortgage?
i.e. how was there a transfer of ownership to you with a mortgage remaining outstanding in your dad's name?
Craigybaby69 said:
They're now talking about us both having to go over and sign a document bin front of a power of attorney....what a ballache
It sounds like you may have inadvertently told the bank that the money is not 'his' and now they are getting suspicious about the source of funds.For my UK mortgage I have account details for overpayment... if I wanted to pay off the loan I would just make a bank transfer to that account and not warn the bank about it.
In spain property transactions are notarised. When your dad bought the apartment he will have gone to the local notary with the seller and a representative from the bank. If he didn't then he will have signed to allow his lawyer to act on his behalf.
Any change to the mortgage including paying it off early (but not overpayments) have to be logged with the notary.
He can give his authority for a lawyer or gestoria (like a sort of legal person who fills in forms and deals with bureacracy) to act on his behalf but ultimately it has to go to the notary.
Now regarding the sale to you, please get some advice on this. Your dad is liable for capital gains tax, in the uk and spain. The local region will also want tax on the cadastoral increase in value (essentially the local authority expect land value to increase each year so they put a notional value on that increase each year. Probably small for an apartment but these are all costs you need to know about).
Of course the sale will need to go to the notary, again a lawyer or gestoria can arrange.
Who does your dad use for his anual spanish tax return (you have to do one as a non resident even if no income in spain)? It will likely be a local gestoria, speak to them they will help you!
Any change to the mortgage including paying it off early (but not overpayments) have to be logged with the notary.
He can give his authority for a lawyer or gestoria (like a sort of legal person who fills in forms and deals with bureacracy) to act on his behalf but ultimately it has to go to the notary.
Now regarding the sale to you, please get some advice on this. Your dad is liable for capital gains tax, in the uk and spain. The local region will also want tax on the cadastoral increase in value (essentially the local authority expect land value to increase each year so they put a notional value on that increase each year. Probably small for an apartment but these are all costs you need to know about).
Of course the sale will need to go to the notary, again a lawyer or gestoria can arrange.
Who does your dad use for his anual spanish tax return (you have to do one as a non resident even if no income in spain)? It will likely be a local gestoria, speak to them they will help you!
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