Bank Repossession Buying in Spain


Posted and filed under Property in Spain, Property Purchase/Sale Service.


The covid 19 crisis means that buyers are looking for bargain property in Spain, and we can help.

During the last economic crisis, around 2008 people did a lot of bank repossession buying in Spain. A recession, due to Coronavirus, is imminent and a recession means property prices drop. Economists are telling us it will be a very quick return to normal prices but in the meantime, our clients are searching for those special deals. 

This area of the Costa Blanca from Alicante all the way to Murcia and into Almeria especially, has a lot of second homes. 

It is always the mortgages on the second homes that do not get paid first, if a client has to decide which mortgage to pay. This attitude means that for the opportunist buyer, bank repossession buying in Spain is even more attractive.

How Attractive Are Prices?

There are still properties available on the market from the last crisis. But Spanish Banks had been reluctant to give them away. However, now they will have that stock. And also they know that they will be repossessing a great deal more homes. So we think that the banks will be ready to cut you some deals.  Banks are going to need to move properties off their books quickly. As a result they are already starting to reduce prices.

We see a whole window of opportunity opening up for those who have cash to buy in Spain as a long term investment. We can also introduce you to mortgage brokers but the best is if you have funds ready to buy. That way you are going to get the better deal. We can help you through the process at Spanish Solutions from finding a property to acting for you in the purchase to ensure all is above board.

Bank Repossession buying in Spain – How do you go about it?

1) The first way is to buy directly from a Bank in Spain. Perhaps they may have already sold the property onto an investment company but for all intents and purposes you’re buying “from the bank”. 

After a repossession has taken place the ownership of a property is transferred to the Bank or a company. (Sometimes called Vulture funds). They will be looking to sell to turn their investment into money and often very cheaply. 

The buyer must ensure that they do not inherit any of the previous debts- Again Spanish Solutions will help. In Spain, debts are attached to the property not the debtor so an unsuspecting buyer may inherit them if they are not careful. 

We had this case with a client who bought a repo directly from Bankia in 2017, and inherited the debts of almost 7,000 euro as he didnt use a Spanish lawyer!

You need a professional who is comfortable dealing with the legalities of buying repossessions to act for you, negotiate and get you the best deal.

2) The second way to do bank repossession buying is in a Public Auction.

Banks like selling in a public auction as it gets rid of a property quickly and cheaply. It means they do not have the expense of transferring the property into their ownership, saving them 10% tax alone, plus thousands on notary, land registry etc. Thus if you can find out about auctions and buy a property at one this can be a good move.

You should never do this without professional help. If you go about bank repossession buying in Spain through an auction and do not use a legal firm, you could end up with large debts transferred to you or undetected construction problems. 

Sometimes for whatever reason, Estate agents tell clients they don’t need a lawyer. We disagree.

You need a lawyer anyway to act for you in the Courts to make a bid in Public Auctions, so if your agent is saying they will deal with everything, they are employing one anyway. 

This solicitor is working with the estate agent, not necessarily for you. You need someone to look after your interests and that is why clients love Spanish Solutions. 

Please contact us if you are interested in bank repossession buying in Spain.

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