In Madrid, lending money to a private individual is legal: draw up a contrato de préstamo, pay by bank transfer, file the exempt modelo 600 with the Comunidad de Madrid and be wary of anonymous lenders contacted online.
Madrid, financial capital and a hunting ground for scammers
The Spanish capital hosts the headquarters of the Banco de España and the CNMV, which scammers exploit by claiming to be registered in Madrid. A genuine professional lender appears in the official registers; a Madrid address alone proves absolutely nothing.
A young, student and Latin American population
The Complutense and Autónoma universities attract thousands of students, while the Venezuelan, Colombian and Peruvian communities are large in the capital. These groups, sometimes without a Spanish credit history, are favourite targets of fake quick-loan offers.
Modelo 600 with the Comunidad de Madrid
In the Madrid region, the property transfer tax is managed by the tax services of the Comunidad de Madrid. A peer-to-peer loan is exempt, but the borrower still files the form, often online, within the regulatory deadline.
High rents and the rental deposit
Housing costs in Madrid push many tenants to borrow from a relative for the fianza, the deposit required when signing a lease. Even for a few thousand euros, a written contract and a named bank transfer prevent family misunderstandings.
Setting a reasonable rate without a legal cap
Spain has no numerical usury rate; the 1908 Azcárate law leaves the judge to assess whether interest is disproportionate. Between Madrid residents, a rate close to the interés legal del dinero, set by the budget law, limits disputes.
Madrid notaries and direct enforceability
The Colegio Notarial de Madrid brings together the region's notaries. An escritura pública makes the contract enforceable without a long trial, reassuring the lender for a large sum. Our page on the peer-to-peer loan agreement lists the essential clauses.
Madrid crowdlending: check the PSFP licence
Several crowdfunding platforms operate from Madrid, but only those entered in the CNMV register of PSFP may offer loans to the public. They mainly fund small businesses and property projects, not everyday household spending.
Frequent frauds reported in the capital
Common scams combine a fake lender on social media, a fake contract with an official letterhead and a request for upfront fees. Some even steal the names of real notaries; see the fake notary loan scam to recognise this pattern before paying.
Filing a police report in Madrid
A denuncia can be filed at any Policía Nacional station, or started online for certain offences and then confirmed in person. Keep screenshots, IBAN numbers and WhatsApp messages, which Madrid investigators need to trace the fraudsters.
Free advice for consumers in Madrid
The Oficina Municipal de Información al Consumidor (OMIC) of the Ayuntamiento de Madrid and associations such as OCU or FACUA give free guidance in disputes. Over-indebted Madrid residents can also consult a lawyer about the so-called second chance law.
Interest declared on IRPF by a Madrid lender
A Madrid lender declares interest received as income from movable capital in the annual IRPF return. An interest-free loan must state that it is free, otherwise the Agencia Tributaria may presume remuneration calculated at the statutory rate.
How Madrid compares with Barcelona and the rest of Spain
Civil rules are national, but the handling of modelo 600 varies by region. For an overview, read the guide to peer-to-peer loans in Spain or the page on a private loan in Barcelona.
Steps for a private loan in Madrid
- Meet the lender in person in Madrid and compare their DNI or NIE with the name of the bank account holder.
- Sign a contract in Spanish stating the sum, term, rate and schedule, with an original copy for each party.
- File the exempt modelo 600 with the tax services of the Comunidad de Madrid after signing the contract.
- Transfer the funds from an account in the lender's name to an account in the borrower's name.
- Consider an escritura pública with a Madrid notary if the amount exceeds what you can afford to lose.
- Keep statements, contract and filing receipt for the whole loan term, then for at least four more years.
What a private loan costs in Madrid
| Item | Cost in euros (indicative) | Comment |
|---|---|---|
| Interest between individuals | Free; legal benchmark of 3.25 % in 2026 | A disproportionate rate can be annulled by the judge |
| Modelo 600 with the Comunidad de Madrid | 0 € | Loan exempt from ITP, filing still required |
| Notarial deed | According to the official notary scale | Recommended above a few thousand euros |
| Tax on interest (IRPF) | From 19 % to 30 % (indicative) | Paid by the lender |
| Advance demanded by an online lender | Money lost | Scam to report to the Policía Nacional |
Paperwork to prepare in Madrid
- Valid DNI or NIE
- Certificado de empadronamiento in Madrid
- Last three nóminas or proof of income
- Contrato de préstamo signed in two copies
- Modelo 600 filing receipt
- Proof of the transfer of funds
Traps to avoid in the capital
- Believing that an address near the Banco de España or the CNMV guarantees that a lender found online is serious.
- Paying file review fees by Bizum to a stranger who promises a quick loan without any supporting documents.
- Signing a contract received as a PDF bearing copied official stamps, without ever having met the lender.
- Lending cash to a flatmate with nothing in writing, then being unable to prove the debt before a Madrid judge.
- Sending a copy of your DNI and bank card, the raw material of identity theft.
Your questions on private lending in Madrid
Where do I file modelo 600 for a loan signed in Madrid?
With the tax administration of the Comunidad de Madrid, online or at its offices. Filing is in principle the borrower's job. The transaction is exempt from ITP, so nothing is payable, but failing to file weakens the proof of the loan.
A lender on Instagram says it is licensed in Madrid: how do I check?
Search for its name in the Banco de España and CNMV registers, as well as the CNMV warning list. An unverifiable licence, contact only via WhatsApp or a request for fees before payout are enough to reject the offer.
Can I lend to a student friend in Madrid without interest?
Yes, provided it is stated in black and white in the contract. Without that clause, the Agencia Tributaria may presume the lender receives interest at the statutory rate. Modelo 600 must still be filed, whatever the amount lent.
What can I do if a Madrid borrower does not repay?
First send a formal demand by burofax, which counts as evidence in court. The procedimiento monitorio then lets you claim a documented debt before the court of first instance. A lawyer from the Madrid bar will explain deadlines, costs and recovery prospects.