Perini Finance & Property §34i GewO · Mortgages in Spain & Portugal
Guide · choosing a bank · Spain

Spanish vs. German bank — which is better?

Many foreign buyers ask: should I choose a Spanish or a German bank? A direct comparison of the key criteria.

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Author & regulatory separation. Content author: Siegfried Perini. Mortgage brokerage in Spain and Portugal is carried out under the §34i permit of Olga Nikushkina (BAFA-notified). This information does not replace legal or tax advice.

Guide · choosing a bank

Which bank suits your situation?

Many foreign buyers ask: should I choose a Spanish or a German bank for my Spanish mortgage? The honest answer: it depends on your situation. A direct comparison of the key criteria.

Comparison matrix

The key differences at a glance

Spanish bank

Pros & cons

+ On the ground, knows the regional market
+ Faster processing (2–6 weeks)
+ Lends against the property itself — no German second collateral needed
− Language barrier (often only Spanish/English)
− Possible compulsory insurance products
− Typical rates 0.3–0.8% higher than in Germany

German bank

Pros & cons

+ Lower fixed rates (3.0–3.8%)
+ Contract in German, a familiar point of contact
+ No language barrier
− Longer processing time (6–12 weeks)
− Often requires second collateral (a German property)
− Few banks offer foreign financing at all

Recommendation by situation

Which bank, and when?

  • A pure Spanish property with no German collateral: a Spanish bank — the German bank will often demand second collateral.
  • A premium property over €1m: an international private bank (UBS, JP Morgan, BNP Paribas) — the best terms, a tailored solution.
  • Very strong credit profile, wanting a German fixed rate: a German bank is worth it — cheaper fixed rates and no exchange-rate uncertainty (euro area).
  • A standard purchase of €250,000–500,000: assess both options — after a credit check I can often give a concrete recommendation.
FAQ

Frequently asked questions

Which bank is cheaper for a Spanish mortgage?
German banks typically offer cheaper fixed rates (3.0–3.8% instead of 3.5–4.5%), but often require second collateral and take longer. Spanish banks are faster and accept the Spanish property alone as security.
Which German banks finance in Spain?
Few. DKB, Comdirect (limited), some Sparkassen with international departments. Most German house banks refuse foreign financing or require a fully secured German property as second collateral.
Which Spanish banks have non-resident programmes?
BBVA, Santander, CaixaBank, Banco Sabadell, Bankinter — all with active programmes. Terms vary widely depending on credit profile, property and region.
What is second collateral?
Some German banks require a German property (ideally unencumbered) to be registered as additional security. That complicates the purchase and ties up the German home. Spanish banks need no German second collateral.
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