03 Jun 2024

New Spanish Mortgage Scheme Benefits Young First-Time Buyers And Families

Published in Buyer tips

The Spanish Government has announced a new scheme that aims to allow families with small children and those under 35 years old to buy a property. With this ICO guarantee scheme, the Government steps in as a guarantor for people who can’t save up a mortgage deposit.

Banks including Santander, Caja de Ahorros de Ontinyent, Arquia, Unión de Créditos Inmobiliarios, Ibercaja, and EVO Banco, have signed up to the scheme.

The scheme allows for 100% mortgage financing, with the ICO guaranteeing up to 20% of the mortgage loan (25% for homes with an energy rating of D or higher). This allows solvent buyers who qualify to secure a mortgage without a down payment.

The guarantee is free for home buyers and banks, which are responsible for studying and analysing the operations. The scheme, endowed with 2.5 billion euros, will end on December 31, 2025 but may be extended until 2027.

The Spanish Ministry of Housing estimates that 50,000 families could use the ICO scheme to purchase their first home.

Who is eligible for the mortgage guarantee?

To be eligible, you must have been a legal resident of Spain for at least two years and meet specific income criteria. Young buyers need to be under 35, but there is no age limit for families with children. Additionally, single-parent families and those with dependents may receive increased support.

Applicants must not have assets of over 100,000 euros and not exceed an income of 37,800 euros gross per year. If the home is acquired by two people, their combined income cannot exceed the sum of the limit established for each individual.

The guarantee is free for both buyers and banks, which will manage the evaluation and analysis of applications. The deadline for this scheme is December 31, 2025, with a possible extension to 2027.

If you meet the eligibility criteria and are considering buying a home, this scheme might be worth exploring. It could provide an opportunity to secure financing that has previously been out of reach. For more details and assistance, feel free to contact us.