Mortgage Subrogation in Málaga

Mortgage Subrogation in Málaga

Mortgage subrogation is one of the financing options a buyer has when purchasing a home. We tell you everything you need to know to do it easily and decide whether it suits you.

Mortgage subrogation can be understood in two ways:

• When a buyer acquires a home and takes over the seller's mortgage, with the same bank and the same terms the seller had. We see this mainly when the seller is a developer selling new-build homes, where the buyer takes over the developer's mortgage, which normally has better terms.
• When a client moves their mortgage to another bank to improve the terms.

Steps to Improve a Mortgage

1. Request your  free advice, and we'll assist you in in person or by phone.
2. Tell us what you need and we'll prepare a report.
3. We submit your mortgage in to several lenders.
4. We present you with several offers so you can choose the one that best suits your situation.
5. We prepare the signing at the notary and go with you.

What does Mortgage Subrogation involve?

The subrogation of mortgage usually refers to when a client moves their mortgage to another bank to change and improve the terms the mortgage and perhaps borrow more amount.

There is another type of mortgage subrogation, in which a buyer buys a home and takes over with the the seller's mortgage, with the same bank and the same terms.

Currently, most banks run advertising offering clients who already have a mortgage the chance to switch lenders, with the promise of improving their current terms.

How is mortgage subrogation done?

As with any mortgage, the first step is to submit all the documents to the bank so it can study the feasibility of the transaction. This process can take between 5 to 15 days, depending on the bank.

Once your profile has been approved, the property needs to be valued the home to check it covers the mortgage amount requested. If all goes well, you should then know the terms of your mortgage and accept or negotiate them to get them lowered.

Once you've accepted the mortgage terms, you need to go to a notary to sign the purchase and its financing.

Change your mortgage in Málaga

How much does mortgage subrogation cost?

The costs of mortgage subrogation are the costs of cancelling of the your current mortgage plus the set-up costs of the new mortgage with your new bank.

The cancellation costs will depend on what you agreed with your bank in your mortgage terms, such as the early repayment fee, as well as the notary and the registration.

And for the new mortgage, the valuation will be your only cost, as the lender covers the rest. Some lenders even pay for the valuation for the client.

Pros and cons of mortgage subrogation

The only real benefit of subrogating a mortgage is getting better terms, especially on the interest rate or type of mortgage.

If you have a fixed-rate mortgage at a good rate, there's no point switching banks unless another one offers you even better terms.

It's important to read the small print of each mortgage, as the interest rate saving you're offered may depend on taking out bank tie-ins that aren't really worth it.

Improve your mortgage in Málaga

We improveall the terms of your mortgage according to your needs. If you already have a mortgage and want to improve any of its terms, our advisors will get you the mortgage that suits you best.

If you want a best interest rate, switch from variable to fixed, borrow more or extend the term, we'll find the best option across all the banks.

We'll assign you a personal advisor who will support you and manage the whole process. We'll negotiate directly with all the lenders to get you the best mortgage.

What does improving a mortgage mean?

Basically, it means improving one or more of a mortgage's terms: term, interest rate, amount, type of mortgage, tie-ins, fees, etc.

There is two ways to improve a mortgage: negotiate directly with your bank o switch lender.

Both options have different costs and processes.

Ways to Improve a Mortgage

If you choose to negotiate with the bank that already holds your mortgage, you'll need to approach your lender and explain your situation. Some banks make the process easy, while others complicate it or even refuse outright.

It's a good idea to check your mortgage deed to see whether a mortgage novation is possible and what the bank charges for it.

You can check with other lenders to see what they offer and get better terms, or wait for your bank's offer before approaching other lenders.

If you approach other lenders, remember they don't know you like your own bank does, so they'll ask for far more documents and the process will take longer, although it's important to have several offers before deciding.

You can also call us so our advisors can tell you what suits you best in your case, and hire us to get you the best mortgage without you having to do anything.

4 Tips to get better terms when you apply for a mortgage

When you apply for a mortgage, you'll certainly want the best one possible. That's why we give you these 4 tips to get better terms when applying for a mortgage.

1. What requirements do banks ask for to grant a mortgage?

Make sure you meet the requirements before applying. Before applying for a mortgage, you need to be clear that you can get one. You can get advice from a financial advisor or your own bank, although your bank will only give you its own view, whereas a financial advisor works with all the banks and is better placed to help you.

Once you know you can get a mortgage, you'll need to gather all the documents required to apply, as the banks will ask for them to carry out their assessment.

2. What is the best financing?

Finance no more than 80% to get good terms. Although some banks lend more than 80% to some clients, the terms obviously get worse the more the client borrows, as the bank's risk increases.

If you want the best possible mortgage, finance no more than 80% of the purchase price so the bank gives you good terms.

3. How do you negotiate the terms?

Take an offer from another lender to negotiate the terms. Get a good offer from a bank you know will approve you. Once the bank has approved your mortgage, it gives you time to decide whether to take it before the offer expires.

During that time, take the offer to other lenders so they improve on it; if they only match it or offer worse, you'll keep the first offer.

If a lender is keen to win new clients, it should make you a better offer, which you can renegotiate again, even with the lender that approved your mortgage first.

Remember this is a business and you need to look after your own interests.

4. Is it better for the valuation to come in high or low?

It's also important for the bank that the home you buy has a valuation higher than the purchase price, and the higher it is, the better the terms you can get.

That's because the lender makes sure the mortgaged property more than covers the money lent and the risk involved.

• What do you need to change your mortgage?

  All you need to move your mortgage to another bank is to find another bank that will give you the financing you need. It doesn't matter that you already have a mortgage with another lender: if you have a good profile, you can consider switching banks and look for a lender that offers better terms.

  So you just need a binding offer from another lender to change your mortgage.

All you need to move your mortgage to another bank is to find another bank that will give you the financing you need. It doesn't matter that you already have a mortgage with another lender: if you have a good profile, you can consider switching banks and look for a lender that offers better terms.

So you just need a binding offer from another lender to change your mortgage.

• How can I change my mortgage?

  You can switch banks in two ways: through mortgage subrogation, or by cancelling the old mortgage and taking out a new one.

  Subrogation: it must be allowed by your bank and is cheaper than a mortgage "poach", as you save the costs of cancelling the old one and setting up the new one.

  Mortgage poaching: this is when you cancel the mortgage with your old bank and take it out again with the new lender. Obviously, to cancel the old mortgage you need the money from the new one.

You can switch banks in two ways: through mortgage subrogation, or by cancelling the old mortgage and taking out a new one.

Subrogation: it must be allowed by your bank and is cheaper than a mortgage "poach", as you save the costs of cancelling the old one and setting up the new one.

Mortgage poaching: this is when you cancel the mortgage with your old bank and take it out again with the new lender. Obviously, to cancel the old mortgage you need the money from the new one.

• How long does it take to change your mortgage?

  It takes practically the same time as applying for a new mortgage: between 30 and 60 days from the application to signing at the notary.

It takes practically the same time as applying for a new mortgage: between 30 and 60 days from the application to signing at the notary.

• How much does it cost to switch from one bank to another? 

  The costs depend on whether you opt for subrogation or a change of bank. Look at the case carefully and do the maths.

The costs depend on whether you opt for subrogation or a change of bank. Look at the case carefully and do the maths.

• Which is the best bank to switch your mortgage to?

  The best bank is the one that gives you the best terms. There are no good or bad banks, but there are better and worse mortgages.

  Obviously, choose the best mortgage and the one that suits you; the bank is entirely secondary.

The best bank is the one that gives you the best terms. There are no good or bad banks, but there are better and worse mortgages.

Obviously, choose the best mortgage and the one that suits you; the bank is entirely secondary.