Refinancing existing Spanish property.

There are three common drivers:

• Better terms: move to a more competitive structure, or switch from a variable to a mixed or fixed-rate product.
• Capital raising: release equity from a property that has appreciated to fund a new purchase, business investment or renovation.
• Exit refinance: replace a maturing development, bridging or short-term facility with long-dated investment debt.

Spanish law offers a mechanism called subrogación de acreedor — effectively porting your existing mortgage to a new lender without cancelling and re-registering the loan. This can reduce notary and land-registry costs materially versus a brand-new mortgage.

Subrogación works best for straight rate-improvement refinances at broadly the same loan amount. Where you're raising additional capital, changing borrower structure or moving between very different lender types, a new mortgage (cancelling the old) is usually cleaner.

Non-residents can typically raise capital to 60–65% of current open-market value, subject to income affordability. The uplift over your existing loan is released at completion and can be used for any legitimate purpose — most commonly:

• Deposits or full purchases of further property.
• Business investment or working capital.
• Renovation, extension or improvement of the Spanish asset.
• Consolidation of higher-cost debt.

Lender purpose codes vary; some Spanish banks restrict capital raising to real-estate use, while international lenders and private banks are more flexible.

Investment-grade refinance is the standard exit for completed development schemes and for bridging facilities that have served their purpose. Key considerations:

• Stabilised income is preferred — leased assets refinance more cheaply than vacant stock.
• A valuation on completion (or 12 months of trading for hospitality) supports pricing.
• Term facilities of 5–10 years are typical, with 15–25 year amortisation profiles.
• Prepayment terms on the existing facility must be modelled into the exit timing.

Spanish law (Ley 5/2019) caps ERCs on residential mortgages at:

• Variable-rate loans: 0.25% in the first 3 years, 0.15% in years 4–5, nil thereafter.
• Fixed-rate loans: 2% in the first 10 years, 1.5% thereafter.
• Commercial and non-residential loans: negotiated in the facility documentation.

Where a refinance triggers ERCs, the pricing improvement or capital release usually needs to pay back within 18–36 months for the move to be economic — a straightforward exercise we model at heads-of-terms stage.

An inherited Spanish property comes with two financing questions. If it carries an existing mortgage, the debt passes with the asset and the lender will reassess the heirs — a non-resident heir often has to refinance onto new non-resident terms of 60–70% LTV. If it is unencumbered, a refinance is frequently how the inheritance tax itself gets funded, once the deed of acceptance is signed and the heirs appear on title.

Timing is the constraint: the tax is due within six months of death. Our Spanish inheritance tax guide for non-residents covers the regional allowances, the deadline and extension rules, and the bridging and refinance routes heirs use to pay.

1. Weeks 1–2: fact-find, existing facility review and indicative refinance terms.
2. Weeks 2–4: full application, underwriting and new valuation.
3. Weeks 4–6: formal offer (FEIN) with 10-day cooling-off period.
4. Weeks 6–10: notary appointment — old mortgage cancelled, new mortgage registered.