Mortgages

Our mortgage brokering service is free of charge to our clients and acts as introducers to the leading lending institutions for properties for sale in Gibraltar & Spain.

There are a number of banks and building societies from which you can borrow money from to finance the purchase. Generally speaking, the maximum amount any lender will lend is 90% of the purchase price for owner-occupiers and 75% on buy-to-lets in Gibraltar.

The amount you can borrow to buy properties for sale in Gibraltar and Spain though, will depend on such factors as your age, earnings, and the amount you want to borrow, taking into consideration the value of the Gibraltar or Spanish real estate you intend to purchase.

Your mortgage is likely to be your biggest financial commitment. It is therefore important that you know what your choices are before you sign on the dotted line.

To open doors to the best mortgage offers just call us or email us to arrange a meeting with one of our mortgage brokers for Gibraltar real estate.


Types of Mortgages

Capital and interest 


The most common type of mortgage is the capital and interest mortgage. This offers the greatest simplicity, with your monthly repayments covering both the capital and interest on the loan, so that at the end of the term you have nothing more to pay.

Interest only (Endowment or Pension Plan)

The monthly repayments cover the interest but not the capital of your home loan and the full amount of the loan is repaid by placing additional funds in long-term investments.

Unlike a repayment mortgage, the amount of debt does not reduce over time and there is no guarantee that your chosen investment will cover the cost at the end of the term. However, you can normally top up your investments if you think this will be the case. There are several options to repay the capital of your home loan.

Endowment

With this repayment option, you pay the interest on your home loan to the lender, plus additional payments to an insurance company to fund a savings plan. This aims to generate sufficient funds to pay off the capital at the end of the mortgage term. Unlike a repayment mortgage, the amount of debt doesn't reduce over time and there is no guarantee that your endowment policy will cover the cost at the end of the term.

You can keep your policy if you move house or remortgage your current property and its life assurance aspect ensures that the loan is paid off should you die before the end of the term. However, the performance of your endowment is determined by the strength of the investment and you may have to review the policy to ensure that sufficient funds are available to cover the loan at the end of the agreed term.

Pension plan 

With this option, you are required to pay the interest on your home loan to the lending institution, plus additional payments to a personal pension fund intended to provide a tax free lump sum to pay off the home loan amount.

The lump sum is payable on retirement and your loan term may be more than 25 years, depending on your age now and when you plan to retire.


Variable rate mortgage

This simple home loan sets the interest rate according to the lenders variable rate.

There are normally no early repayment charges on variable rate loans, which is worth considering if you are thinking of paying off your mortgage early. However, budgeting for the future can be difficult, with unpredictable interest rate movements, and your repayments could rise rapidly if rates go up.

Base rate tracker mortgage

A base rate mortgage tracks an independently set interest rate, such as The Bank of England Base Rate. The benefit of a tracker mortgage is that you are guaranteed that any falls in interest rates will be passed on to you, usually from the beginning of the month after the rate change. However, any rises in interest rates will also be passed on to you.


Fixed rate mortgage on the properties for sale in Gibraltar 

The interest payments are fixed at a specified level for the first few years, allowing you to budget more effectively at the start of your mortgage. When the fixed rate period ends, your interest rate will change to a variable rate or you can choose another of the lending institution's mortgage rates for the remainder of the mortgage term.