Financing

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This was then, potentially, our new holiday home/long term home. As I may have mentioned, it wasn’t the best-looking house in the world, but the outside space was outstanding, the views glorious and the roof terrace huge. The internal layout was ideal as well.

We therefore returned to the UK extremely excited and motivated to progress the financing and purchase of the property. Deb said ‘I’m sure this isn’t going to be straightforward and there will be loads we need to address but firstly I think we need to get the mortgage sorted. Who do we approach for a mortgage on a Spanish house?’ ‘I haven’t got a clue.’ I replied. ‘I know, I’ll get in touch with the broker who got our mortgage on this house. Everything went really smoothly and easily with that one, he should be able to handle it.’ I therefore contacted our broker and asked if he could organise a Spanish mortgage for us. ‘Not my field I’m afraid,’ he said, ‘but I can put you in touch with someone who I’ve dealt with in the past.’ Introducing Rob Govier of the MHI Group, who are international mortgage specialists.

I sent an introductory e-mail to Rob explaining our requirements and our current employment positions, me being self-employed and Deb being employed. He responded very quickly and positively with a long list of documents he required for him to be able to assess our eligibility, such as P60’s for Deb, 2 years tax returns for me, personal and business bank statements, passports, proof of our own funds and Credit Reports from Experian. ‘This is a bit more complicated than last time I applied for a mortgage.’ I said to Deb. ‘All I needed to do last time was to tell the bank I could afford it. Maybe lending has become more stringent following the financial crash.’ ‘It needed to.’ She replied.

Rob then responded saying that we also needed the full address of the property, a copy of the purchase contract, our Spanish lawyers details, a Nota Simple and our NIE numbers. ‘What,’ I said to Deb, ‘is a Nota Simple and what do we do about NIE numbers?’ ‘I have no idea,’ she replied, ‘why don’t you ask Simon the agent?’

I contacted Simon asking what these were and how to get them. He informed us that the purchase contract would be issued once we paid the non-refundable 10% deposit, for this we needed a lawyer and he could recommend one if needed. The Nota Simple is a document from the Property Register that gives all the details of the property such as any outstanding debts such as mortgage or taxes, the name of the current owner and whether anyone else has any rights on the land such as access paths or roads. The lender requires this so they can use it in part of the assessment of the property. Our lawyer would get this document as well. The NIE (or Numero de Identificacion de Extranjero) numbers are tax identification numbers and are mandatory for all foreigners who have financial, professional or social affairs in Spain, whether a resident or not. Apparently, you can apply yourself and I understand it means a visit to a Spanish Consulate in the UK with the appropriate form and fee or you can just let the lawyer do it on your behalf.

‘That seems like a lot of work and cost,’ I said to Deb, ‘if we ultimately, for whatever reason, don’t complete on the property.’ She replied, ‘Can we just get Rob to do an assessment in principle before we go down this route? If everything seems ok with our financials then we can progress to instructing lawyers and pay the deposit.’ That sounded like a plan. As I said, not just a pretty face. We asked Rob to do just that. He told us it would take a week or two as there was a lot to go through and he was currently very busy. We informed Simon the agent that it would be a few weeks before we could confirm the purchase and we got on with our lives.

This included getting ready for our annual trip to Lanzarote the week before Christmas. We had done this for the last 4 years as it’s nice to get a week in the sun during the Winter, the Canary Islands are known for their year-round warm weather, and it extends the Christmas holidays by an extra week. We had re-booked the same villa we rented the previous year as it was perfect. It was private with no over-looking neighbours, no building site next door and no golf course for miles.

When I say, ‘we booked’ what I mean is ‘Deb booked’. She handles all holiday travel arrangements from accommodation to flights and car hire. I am not allowed anywhere near this part of the holiday. It suits me because one person handles the arrangements so there is only one point of blame if ‘the wheel comes off’. Actually, I was told by Deb to not get involved following my first, and only, foray into a villa booking for an earlier holiday in Lanzarote a few years ago. I happened to see an e-mail about this particular villa booking and I had an issue with the price as there was a supplement because there was only 3 of us in a large villa. I e-mailed the owner back saying it was ridiculous charging us a supplement as there would be less cleaning to do, less sheets to wash etc. In fact, we should get a reduction. She e-mailed back saying she had been doing this for years and never had a complaint and that it was standard practice. We e-mailed a couple more times and the tone got more and more heated until she eventually said she would cancel the booking. I told her that was fine and we would find someone who wasn’t going to rip us off.

I said to Deb that evening when she came in from work, ‘I’ve been in touch with the owner of the villa and we had a few words about the price and for some reason she has said she is going to cancel the booking.’ She went mad. ‘What have you done?’ She said. ‘Everything is arranged, flights, car hire everything. That villa sounds ideal and we won’t get another one now. What did you get involved for?’ ‘Well, it sounded like we were being ripped off.’ I said. She replied ‘The pricing structure is standard practice and it’s how the tariffs are worked out on all villas we rent.’ ‘Well it’s not right and I don’t agree with it.’ I fought back. ‘It doesn’t matter whether you agree with it or not,’ she said, getting quite frustrated, ‘that is the way things are done. Now get back to her, apologise profusely for your misunderstanding of the process and pricing and NEVER get involved again.’ That was me told. I then had to grovel to the owner, sincerely apologising, explain that I never get involved in these things normally and could we have our booking back, please. She relented and strongly suggested I don’t deal with holiday bookings in the future. So, I don’t.

You may ask why we didn’t consider a property in Lanzarote if we like it so much. Well Lanzarote is great for a holiday. We like to stay in Playa Blanca, which is a little less built up and has a fantastic promenade walk for miles and a bustling town with all the usual bars, restaurants and shops. But that is all there is. If you want a change then you go to visit another tourist town or drive through the picturesque landscape. Great for a couple of weeks maximum, but for years? No thanks. We want the diversity of coastal towns, inland towns, large cities and even do a little touring through Europe, possibly France and Portugal to try and change our opinions of them. If you’re on an island it isn’t as easy. I’m sure people will disagree but that is just our opinion.

During the couple of weeks leading up to our Lanzarote trip, the talk was all about the house in Montroi. What work we were going to carry out, such as a balustrade to the roof terrace for safety and to try and lift the aesthetics of the building somewhat. There was a fair amount of work to be done to the grounds to tidy them up, but that could be carried out over time, and the pool needed some refurbishment work. ‘We’ll see how the financial assessment comes back,’ I said to Deb, ‘then we can programme the works.’ ‘Sounds good.’ She said. Back in the good books after getting the villa booking reinstated.

Thursday December 15^th, that date will always be etched in my memory, we set off for the airport and our week in Lanzarote. Everything was upbeat, going on holiday, nearly Christmas and a new house in Spain to look forward to. Life was good. Plane journey was uneventful as usual and we de-planed at Arrecife airport 4 and a half hours later. As we are stood in passport control, I switched the flight mode off on my phone and checked my e-mails. ‘I’ve got a message from Rob Govier.’ I said to Deb excitedly. ‘Brilliant,’ she said, ‘this holiday couldn’t start any better, great timing. What does he say?’ He said he had taken it to the bank and we didn’t meet their affordability criteria. Our credit commitments, including mortgage, car loans etc were such that we didn’t comply with the stringent requirements. The only way forward was to reduce our credit commitments or raise money against our UK property.

Well that took the edge off the holiday I can tell you. Deb was devastated. ‘What do we do now?’ She said. ‘Let’s try to enjoy this holiday as much as we can,’ I said, ‘we’ll discuss best way forward over the Christmas holidays and hit the ground running in 2017.