As old and new homeowners are trying to navigate the housing market, inflation plays a role in changing loan interest rates. Even though the inflation rate in Spain decreased to five per cent in August 2023, consumers are still affected by the economic hardships. Because of the high inflation, debts have increased, placing more people on credit blocklists. So how it is still possible to get a house loan despite these challenges?

Getting a loan despite the ASNEF

Around the world, there are economic blacklists which record people’s bad debts. Because of the current financial climate, some people have gone bankrupt and are burdened by debts. Therefore, some people end up on these blocklists. For example, ASNEF is a blocklist, short for National Association of Financial Companies. People on these lists should then pay the debt and wait six years before being excluded from the list. This makes it difficult to loan money for a house, a car or other personal things.

However, those people can seek loans with ASNEF and Payroll anyway. By requesting a loan through an online application, it takes a few clicks to get accepted. As long as the lender has a payroll, the financial institution will accept most profiles in ASNEF. If the person in ASNEF is solvent, some lenders can be more risk-tolerant towards them. By requesting a loan through online lenders, even if you are in ASNEF, the loan experience can be hassle-free.

Types of home loans

A home loan is essentially a sum of money consumers borrow from a bank or a financial institution to buy a house or refinance. There are different types of loans which people can choose from. One of the most common home loans is the classic one, where the homeowner has to pay a specific amount over time depending on income, debt and age.

This type of loan is divided into two: a variable-rate and a fixed-interest-rate loan. The former is the most common, where the interest rate can change over time when the bank adjusts its base rate. A fixed-rate loan gives a set interest rate, where the loan is taken out for a fixed period.  

Other reasons for getting a loan rejection

There can be many reasons for getting a rejection for a loan besides being in ASNEF. For example, a low income or too much debt can be a reason for the rejection. But sometimes, it depends on the lender. For example, one lender might not accept the person, while another lender with different criteria can choose to do so.

Getting a house loan during the inflation

Since 2015, property prices in Spain have increased by 35 per cent. Apartments and houses are becoming increasingly expensive, which follows the trend in other European countries. However, the demand for apartments, penthouses and villas is also high. Regarding homeowners, a Spain bank raised eyebrows when it announced that it would raise its interest rates for home loans from 2.7 per cent to 3.1 per cent.

Furthermore, first-time buyers would have to pay 20 per cent of the property value when applying for a loan. Even though the bank backtracked on the down payment, the interest rates would still be high.

Disclaimer: The information provided in this article is being provided solely for promotional and informational purposes and should not be construed as investment, tax or legal advice.

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