20% mortgage guarantee for young people and families with children

In response to the housing emergency that our country is going through, the Government informed about a new line of guarantees through the Official Credit Institute (ICO) with the aim of facilitating the purchase of housing.

On May 9, 2023, this measure was approved by the Council of Ministers.

How does the 20% mortgage guarantee for young people and families with children work?

This initiative does not involve direct subsidy. It consists of backing a part of the mortgage with an additional 20%.

It will be possible to finance a mortgage at 100% although, at the time of payment, the amount corresponding to the guarantee granted will also be included.

In this way, there is a significant change in the amount of savings required to purchase a new home. Instead of requiring 20%, it will be possible with only 10% – 12%.

Generally, banks grant up to 80% of the price of a property and buyers must provide the remaining 20%. With this guarantee, the bank will be willing to lend 100% of the total value.

For example, if we want to buy a house valued at 100,000 € and the bank lends us 80% of the value – without the Government guarantee – we would have to contribute 20,000 € as a down payment; and to this amount we would have to add the amount corresponding to the purchase and sale expenses and taxes.

With this initiative, the bank would finance the 100,000 €. We would go from having to contribute a down payment of 20,000 € plus some 10,000 € – 12,000 € of expenses/taxes; to only having to save for the latter.

What requirements must be met to obtain the guarantee for the purchase?

These are the conditions to be able to access the help of the Government guarantee:

• To be under 35 years old or to be a family with dependent minors.
• To live in Spain and to have DNI or NIE.
• To have a financial profile suitable to apply for a mortgage.
• That the property is the first one to be purchased and destined to the habitual use.
• That the home does not exceed the maximum price specified in each grant by the Autonomous Community.
• To have an income of less than 37,800 euros per person per year (or 75,600 euros if there are two buyers together).

Discover the best properties for sale

Did you know that in KM2 Servicios Inmobiliarios – real estate agency in Barcelona and Madrid – we have more than 41 years of experience in the sector?

A long trajectory in which we have had the opportunity to help countless families to find the home of their dreams.

Our real estate portfolio consists of very good assets located in some of the best areas of the city.

Contact us so we can help you find a home that meets all your needs.