247 Expat Insurance specialises in health insurance for people moving to or living in Spain. We no longer arrange reverse mortgages or equity release; this page is a general information guide.
One of the most important things to understand about a reverse mortgage before you commit is the cost.
We believe in complete transparency here — there are real costs involved, and some of them reduce
the net amount you receive upfront. Here is an honest breakdown of every fee and charge, in plain English.
The most important thing to understand first
Before we get into the set-up costs, let us be clear about what a reverse mortgage does
not cost you on a day-to-day basis — because this is the feature that surprises
most people when they first encounter it.
There are no monthly repayments, no annual fees, and no ongoing charges you have
to manage. Once the mortgage is in place, you do not pay anything each month.
The interest accrues on the outstanding balance and is only settled when the loan is
eventually repaid — by you if you cancel, or by your heirs after your death.
This is the core financial structure of the product. The costs that do exist fall
into two categories: one-off set-up costs at the beginning (typically
deducted from your initial drawdown), and the interest that accrues silently
over time on the outstanding balance.
The reverse mortgage (hipoteca inversa) is structured so that all costs are either
paid upfront or deferred to when the loan is eventually settled. You live in your
home, you own your home, and no money leaves your pocket each month.
What you pay at the start
These are the costs incurred when the reverse mortgage is arranged. Most are deducted
from your initial drawdown rather than being paid directly out of pocket. Here is each
one in full.
Typically €300–€600
An independent appraisal of your property’s current market value is required before
the mortgage can proceed. This is carried out by a regulated valuation company
(sociedad de tasación), not by the lender or by us — an important safeguard.
The exact cost depends on your property’s size and location.
Important: This is the first
real cost you incur — and only if you decide to proceed past the free initial
consultation. If you request an appraisal and then choose not to continue, this fee
is not refundable.
Typically €600–€1,500
The reverse mortgage must be executed before a Spanish notary
(notario). Notary fees are calculated based on the loan amount and
the complexity of the deed. They typically range from approximately €600 to
€1,500 depending on the total loan value.
Note: The 90% fee reduction
that applies under Ley 41/2007 relates specifically to land registry
registration — it does not apply to notary fees.
90% statutory reduction applies
When the mortgage is registered at the Land Registry (Registro de la
Propiedad), the applicable fee benefits from a 90% statutory
reduction compared with a standard mortgage registration, under
Ley 41/2007. This is a meaningful saving: a standard mortgage registration
might cost several hundred euros; under the reverse mortgage exemption, it
is a fraction of that amount.
The mortgage deed is also exempt from Stamp Duty (AJD — Actos Jurídicos
Documentados), which represents a further saving on what you would pay
for a conventional mortgage.
Varies by provider
Some providers charge an opening commission (comisión de apertura) on the
loan amount. Not all insurance include this charge — it varies by provider and product
structure. Where it applies, it is typically expressed as a percentage of the loan
amount and deducted from the initial drawdown rather than paid separately.
Providers are required to disclose a full fee schedule before you commit to anything.
Generally modest cost
Spanish law (Ley 41/2007) requires that you receive independent financial advice
before signing a reverse mortgage — specifically to ensure you understand the product’s
full implications for you and your heirs. This advisory report must be prepared by a
qualified independent party, not by the lender.
The cost of this report varies but is generally modest relative to the other set-up
costs.
The ongoing cost you cannot see
The reverse mortgage accrues interest on the outstanding balance throughout the loan
term. This is not a fee you pay — it is a balance that grows. Understanding it is
essential before you sign.
The interest rate is agreed at the time of signing. Most Spanish reverse mortgage products
use a fixed rate, which is an important advantage: you know exactly what
rate applies for the life of the loan and your heirs can plan accordingly. Variable-rate
products do exist, but they are less common for this product type.
Because you make no monthly repayments, the interest compounds — meaning
it is added to the outstanding balance each year, and the following year’s interest is
calculated on that larger balance. The longer the mortgage runs, the larger the balance
your heirs will need to repay or settle.
If you decide to cancel the reverse mortgage before it naturally ends — for example,
because you want to sell the property, move into care, or simply change your mind — a
cancellation or early repayment commission will typically apply. The exact amount varies
by provider and by how early in the term you cancel.
This commission should be understood before signing.
What this means in practice
The costs are real — but they are typically modest relative to the amount being released.
Here is an illustrative example of how a lump-sum drawdown works in practice.
Figures are illustrative only. Actual costs depend on the provider, property value,
and loan amount. A free personalised study will show you the precise net figures
applicable to your situation.
Before you commit a penny
We think this is worth stating clearly, because it matters: you can explore the reverse
mortgage in full detail — with real figures for your property and your situation — without
spending a single penny until you decide to proceed.
The initial consultation with 247 Expat Insurance is completely . Your personalised calculation study — the document that shows
you exactly how much you could access, what the set-up costs would be, and how the
balance would grow over time — is also prepared at no charge and with no
obligation.
The appraisal fee is the first real cost you incur. And that only happens when you make
an active decision to proceed to the next stage. You are not committed to anything until
you sign before the notary.
Compound interest — a worked example
The most important thing to understand about the interest on a reverse mortgage is
that it compounds. Here is a plain-English illustration using a €100,000 loan at a
fixed illustrative rate of 5.5%.
Assumptions: €100,000 lump sum. Fixed rate 5.5% (illustrative — actual rate confirmed
by provider). Property value at inception: €400,000. Property value assumed to be the same
at Year 10, 15, and 20 for simplicity.
All figures are illustrative. Based on €100,000 at 5.5% fixed compounding annually. Property value held constant at €400,000 for illustration. Actual interest rates must be confirmed with the provider. This is not a quote or projection for your situation.
The key insight from this example: even at Year 20, your heirs would inherit a property
(in this illustration, worth €400,000) and repay the lender €292,000 — keeping
approximately €108,000 in net equity. The reverse mortgage has served its purpose
across two decades while still leaving a meaningful inheritance.
Of course, property values do change. If values rise, the equity your heirs retain is
larger. Your personalised study will include balance projections alongside illustrative
property value scenarios so you can see the full picture.
A note on transparency
At 247 Expat Insurance, we do not benefit from obscuring costs or burying figures
in small print. Our role is to help you make a good decision — not just any decision.
Every cost we have described on this page will appear explicitly in your personalised
study before you proceed to appraisal. You will know the gross amount the lender is
willing to advance, every itemised deduction, and the estimated net amount reaching
your bank account — before you spend a single euro.
We will also show you the interest rate applicable to your case, the projected balance
at Year 10, Year 15, and Year 20, and the cancellation terms that apply if your
circumstances change. There are no hidden fees and no nasty surprises.
Common questions about costs
The main set-up costs are: an independent property appraisal (tasación),
typically €300–€600; notary fees, typically €600–€1,500 depending on the loan
amount; land registry registration (which benefits from a 90% statutory fee
reduction under Ley 41/2007); an arrangement or opening commission charged by some
providers; and an independent advisory report required by law.
All costs are disclosed before you commit. Most are deducted from your initial
drawdown rather than requiring a separate payment out of pocket. A combined
set-up cost of approximately €3,000–€5,000 on a €120,000 lump sum is a broadly
typical range — though your personalised study will give you the exact figures.
No. There are no monthly repayments on a Spanish reverse mortgage (hipoteca
inversa). There are also no annual fees or ongoing charges to manage.
The interest accrues on the outstanding balance and is only settled when the loan
is eventually repaid — either by you if you cancel the arrangement, or by your
heirs after you pass away. This is the core financial structure of the product.
The interest rate is agreed at the time of signing. Most products in Spain use a
fixed rate, which provides certainty — you know exactly what rate applies for the
life of the loan. Variable-rate products exist but are less common for this product
type.
Because no monthly repayments are made, interest compounds over time — meaning the
total outstanding balance grows each year. The exact rate depends on the provider and
market conditions at the time of application. Actual rates must be confirmed with a
free personalised study.
Yes. Under Ley 41/2007, the land registry registration of a qualifying Spanish
reverse mortgage benefits from a 90% reduction in the applicable registration fee
compared with a standard mortgage. The mortgage deed is also exempt from Stamp Duty
(AJD — Actos Jurídicos Documentados).
These are meaningful savings, particularly on the land registry side. However, it
is important to note that notary fees themselves do not benefit from the land
registry reduction — that saving applies only to the registration charge itself.
Yes. If you cancel the reverse mortgage before the loan naturally ends — for example
because you want to sell the property or move into care — a cancellation or early
repayment commission will typically apply. The exact amount varies by provider and
by how early in the loan term you cancel.
This should be understood clearly before signing.
The appraisal (tasación
Once you request an appraisal, you are committed to that cost (typically €300–€600)
regardless of whether you go on to complete the mortgage. If the appraisal comes back
lower than expected and you choose not to proceed, the fee is not refundable. No cost
is incurred simply by exploring your options or requesting a calculation study.
Property & location eligibility note:
The hipoteca inversa through the provider is currently available on eligible properties in specific municipalities across mainland Spain, the Canary Islands, and selected other locations. Availability depends on the property’s exact location, its type (flat or detached house), its value, and whether it is your habitual residence (vivienda habitual). Properties in some areas — including parts of the Balearic Islands — may have limited or no current availability. Maximum loan debt is €1,000,000. Please confirm whether your specific property qualifies before taking any action.
