The line of mortgage guarantees signed between the Official Credit Institute (ICO) and the Government to cover 20% of the total value of a mortgage will end on 31 December 2025. What are the requirements and conditions for applying for one?

To prevent the lack of savings from being an impediment to access to homeownership for young people who do not have enough money to pay the 20% down payment, the State Government, in collaboration with the Official Credit Institute (ICO), has launched a mortgage guarantee with which up to 100% of the purchase of a home can be financed. This measure is free of charge for the mortgage holder and the bank that grants it.

The line of guarantees with the ICO is endowed with 2,500 million euros and is aimed at people under 35 years of age and families with dependent children, to help them buy their first home. The government expects this measure to help more than 50,000 solvent citizens who have not been able to save enough for the down payment on the purchase of a house or flat, given that, as a general rule, financial institutions will only finance approximately 80% of the assessed value of the property.

This guarantee may be up to 25% if the home purchased has an energy rating of D or higher, and will be valid for 10 years from the date the transaction is formalised. The deadline for formalising loans under this line of guarantees will end on 31 December 2025, with the possibility established in the agreement of extending the period until 2027. In the case of Catalonia, the price of the property to be purchased may not exceed 300,000 euros.

Additional requirements to be met by applicants

The guarantees are designed for natural persons of legal age, with legal residence in Spain, accredited continuously and uninterruptedly during the two years before the loan application and with an income that does not exceed 37,800 euros gross per year (4.5 times the IPREM).

If two people buy the home, the income limit is doubled. In addition, with some exceptions, they may not previously own another home and the guaranteed party’s maximum assets may not exceed 100,000 euros.

During the term of the guarantee (up to 10 years), the home must be the habitual residence of the beneficiary, unless there are circumstances that require a change, such as the consummation of a marriage, marital separation, job transfer, obtaining first occupancy or more advantageous occupancy. In these cases, the home may be rented.

To access ICO guarantees, a procedure is stipulated in the Official State Gazette (BOE), which also details the documents to be submitted.

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