At a glance
Key facts
Figures reviewed:
- Typical reservation fee
- €6,000 – €20,000
- Paid before completion
- 20% – 40% plus IVA
- Non-resident mortgage at completion
- Up to 70% of value
- New-build IVA (mainland)
- 10% plus AJD
- Fixed-rate band at completion
- 2.80% – 3.90%
- Typical build period
- 12 – 30 months
Indicative figures for guidance only, correct as at July 2026. Rates, costs and timelines vary by lender, borrower profile, asset and jurisdiction, and are not an offer of finance. How we derive these figures.
Methodology and assumptions
- Figures are compiled by Clifton International specialists from live lender term sheets, indicative quotes and completed transactions arranged over the preceding 12 months.
- Rates and costs are stated as ranges rather than a single number because pricing is set case-by-case on borrower profile, residency, asset type, location and loan-to-value.
- Timelines assume a complete document file from the outset; valuation, legal capacity and (in Spain) NIE and notary availability drive the critical path.
- Costs exclude any lender, broker or third-party fees not stated on the page, and exclude currency movement between agreement and drawdown.
- Figures are reviewed at least quarterly and re-checked against lender pricing whenever a material market change occurs.
Last reviewed . Read the full Key facts methodology, or speak to our team for a quote based on your circumstances.
How do off-plan stage payments work in Spain?
You pay in instalments as the building progresses: a reservation fee, a larger payment on signing the private purchase contract, then construction instalments, with the balance paid at the notary on completion. A Spanish mortgage is arranged for that final payment only, so the earlier instalments come from your own funds or from finance raised against other property.
- Reservation fees are typically €6,000 – €20,000 and take the unit off the market.
- Expect to have paid 20% – 40% of the price plus IVA before completion.
- Each payment must be covered by a developer bank guarantee or insurance policy.
- The mortgage is signed at the notary once the licence of first occupation is issued.
Key takeaways
- Spanish banks lend on finished, registered property, so a mortgage is signed at completion — not during construction.
- Most buyers have paid 20%–40% of the price plus IVA before the mortgage is drawn.
- Every payment beyond the reservation must be covered by a bank guarantee or insurance policy under Spanish law.
- Developer subrogación can cut set-up costs but locks you into that bank's rate and conditions.
- Bridging or a remortgage against existing property is the usual way to fund instalments without tying up all your cash.
Off-plan or resale — what changes for your finance?
The lending is the same product at the end. What differs is when the money is needed and how long your cash is committed.
| Feature | Off-plan new build | Resale property |
|---|---|---|
| When the mortgage completes | At handover, often 12 – 30 months after reserving | Six to twelve weeks after the offer is accepted |
| Cash needed before completion | 20% – 40% of price plus IVA in instalments | 10% arras deposit, then completion |
| Purchase tax | 10% IVA (IGIC in the Canaries) plus AJD | ITP transfer tax, 6% – 13% by region |
| Valuation timing | Only once the property is finished and registered | At application |
| Payment protection | Bank guarantee or insurance policy required by law | Not applicable |
| Currency exposure | Spread across the build period | Concentrated at completion |
| Finance for the gap | Own funds, bridging, or developer subrogación | Not usually needed |
Swipe the table sideways to see all columns.
Indicative non-resident pricing from Clifton International's Spanish lender panel, reviewed July 2026. Not a rate offer.
The payment stages, in order
- Reservation. €6,000 – €20,000 to take the unit off the market while contracts are drafted. Credited against the price.
- Private purchase contract (contrato de compraventa). Usually brings the total paid to 20% – 30% plus IVA, within a few weeks of reserving.
- Construction instalments. Further payments tied to build milestones or fixed dates, often taking the total to 30% – 40%.
- Completion. The balance, paid at the notary alongside the mortgage drawdown, plus AJD and completion costs.
Why a Spanish bank will not fund the instalments
A Spanish mortgage is secured on a specific registered property. Until the scheme is finished, the licence of first occupation is issued and the unit is registered in your name, there is no security to lend against — only a contractual right against the developer. That is why banks issue an agreement in principle early but sign the deed at the end.
It also explains a common surprise: the mortgage does not reimburse the money you have already paid. It funds the final balance. If you need the earlier instalments financed, that has to come from somewhere else.
Developer subrogación — when it is worth taking
Developers usually build using a construction loan secured on the whole scheme. On completion, a buyer can take over the portion attributable to their unit rather than arranging a fresh mortgage. Set-up costs and valuation duplication are lower, and the paperwork is quicker because the lender already knows the building.
The catch is that the terms are that bank's terms. Where the subrogated rate is more than a small margin above what the wider panel would offer, the saving on fees is usually wiped out over the term. Price both routes properly before deciding, and remember you can refinance later — see refinancing an existing Spanish property.
How buyers fund the payments before completion
- Own funds. Simplest, but ties up capital for the whole build period with no return.
- Bridging against existing property. Fast, interest often rolled up, repaid from the Spanish mortgage at completion or from a sale — see using UK bridging to buy in Spain.
- Remortgage or equity release at home. Cheaper than bridging where timing allows, but slower to arrange.
- Developer subrogación. Removes the need for a separate completion mortgage, at the price of that bank's terms.
Currency and timing risk over a long build
Instalments are due in euros over eighteen months or more. If your income is in sterling or dollars, buying each instalment at spot means accepting whatever the rate does in the meantime — a 5% move on €400,000 of instalments is €20,000. Forward contracts fix the cost of known future payments, which is exactly what a stage-payment schedule is.
Read currency risk when buying in Spain before you sign the private purchase contract, not after.
Planning for delay
Handover dates slip. Mortgage offers and valuations expire, typically within three to six months, so a delayed completion often means re-submitting documents and accepting current pricing rather than the pricing you were quoted. Build a buffer of at least three months into your plan, keep income evidence current, and check the timings in our Spanish purchase timeline, then check the direct answers in our off-plan stage payments FAQ.
Frequently asked
Questions from readers
Can I get a Spanish mortgage to pay off-plan stage payments?
Usually not. A Spanish bank lends against a finished, registered property, so the mortgage is signed at the notary on completion — not during construction. Stage payments before completion normally come from your own funds, from finance raised elsewhere such as a bridge against another property, or from a developer's own subrogable loan where one exists.
What is subrogación on an off-plan purchase?
Subrogación means taking over the developer's own construction loan on your unit instead of arranging a new mortgage. The bank that funded the scheme already holds a charge over the building, so the paperwork and set-up costs can be lower. The trade-off is that the rate, term and conditions are the ones that bank offers, which may be worse than the best market alternative.
How much is the reservation fee on a Spanish off-plan property?
Reservation fees are typically €6,000 to €20,000, taking the unit off the market for a short period while contracts are drafted. It is credited against the price and is usually the smallest of the payments you will make.
What deposit do I need for an off-plan property in Spain?
Expect to have paid 20% to 40% of the price plus IVA before completion across the reservation, private purchase contract and construction instalments. A non-resident mortgage of up to about 70% of value is then drawn at completion, and the mortgage proceeds effectively reimburse the balance rather than the earlier stage payments.
Are my off-plan stage payments protected in Spain?
They should be. Spanish law requires developers selling off-plan to hold buyer payments in a designated account and to provide a bank guarantee or insurance policy covering each amount paid, refundable with interest if the property is not delivered. Confirm the guarantee is in place before you pay anything beyond the reservation.
When should I apply for the mortgage on an off-plan purchase?
Get an agreement in principle before you sign the private purchase contract, then submit the full application roughly three to four months before the expected completion date. Valuations and offers have limited validity, so applying too early usually means repeating the process.
What happens if the property is delivered late?
Delay is common on Spanish schemes. It affects finance because a mortgage offer and its valuation expire, and because your income and rate position may have moved by the time the licence of first occupation is issued. Build a buffer of several months into your funding plan and keep the lender informed.
Can I use UK property to fund Spanish stage payments?
Yes, and it is one of the most common routes. A bridge or a remortgage secured against UK property releases cash quickly, the euros are bought when the rate suits rather than the day each instalment is due, and the facility is repaid from the Spanish mortgage drawn at completion or from a later sale.
Do I pay IVA on each stage payment?
Yes. New-build purchases in mainland Spain carry 10% IVA on residential units, charged on each instalment as it is paid, plus AJD stamp duty at completion. In the Canary Islands IGIC applies instead of IVA. Budget the tax alongside the instalment, not at the end.
Is off-plan riskier to finance than a resale property?
It carries different risks rather than simply more. The asset does not exist yet, so lenders will not commit final terms until it does, and your cash is committed for longer with currency and rate exposure over the build period. Those risks are manageable with a bank guarantee, a funding buffer and a currency plan agreed at the outset.