The Council of Ministers approves this Tuesday the measures agreed between the Government and the banking sector to alleviate the mortgage burden of more than a million vulnerable families due to the rise in the Euribor.
However, there are still some fringes to close with the banking sector. For now, what is known is that there will be a series of measures divided into three blocks to help those with mortgages, specifically the most vulnerable families. Finally, the aid package will also reach a good part of the middle class, since it will cover income with income of more than 25,000 euros.
What are these aids? In EL ESPAÑOL-Invertia we collect the main measures that, for now, have already been agreed between the Government and the banks.
To whom is the aid directed?
The aid catalog agreed by the banks and the Executive is addressed to all families that have applied for a mortgage and are affected by the rise in the Euribor. The objective is to prevent families from being trapped by this phenomenon and lacking the resources to pay their mortgages. For this there are three large blocks: vulnerable, newly vulnerable and families at risk of falling into vulnerability.
Aid to the most vulnerable families
This category refers to all households that have a mortgage, that their income is less than 25,200 euros per year, that allocate more than 50% of this income to pay the mortgage and that have suffered a 50% increase in the mortgage effort. This is an update of the measures that were already included in the current Code of Good Practices with which financial institutions work and which was also agreed with the Government.
These consumers will have the opportunity to restructure their loans by requesting an interest rate reduction with a grace period of up to five years. Specifically, the decrease in rates will be up to Euribor minus 0.10% (-0.10%) compared to the current Euribor plus 0.25% (+0.25%).
These families, who are the most likely to have mortgage default problems, They will have two years to request the dation in payment of their housing. In addition, in case they have requested a restructuring of the loans, they will be able to request a second one.
Families that make more effort to pay the mortgage
To avoid families that need help and cannot access it, the Government and the banks have decided to launch a extraordinary call. It will be for households that have an income of less than 25,200 euros that allocate more than 50% of their income to pay the mortgage.
However, in this case it could happen that they do not comply with the requirement that the mortgage effort rate has increased by 50%. That is to say, that the number of years they would need to pay off the loan by allocating all their income has increased by 50%.
In this case, they will be able to access a 2-year grace period with a lower interest rate during the grace period and an extension of the mortgage term of up to 7 years. Of course, the total time of the loan cannot exceed 40 years.
Families at risk of being vulnerable
This is an extension of the previous measures, and it is what would be intended for upper-middle incomes. Those families that earn up to 3.5 times the IPREM will be able to benefit from these aids. That is, some 29,400 euros per year. Of course, they will have to meet a series of requirements to be eligible for them.
Specifically, in addition to having an income of less than 29,400 euros, they will have to allocate more than 50% of their monthly income to paying the mortgage. The loan will have to be signed before December 31, 2022, and the mortgage charge must be greater than 30% of your rent and have increased by at least 20%.
All these families will be able to request a 12-month freeze on the installment, reduce the interest rate on the deferred principal and a extension of the term of the loan up to 7 years. Of course, the total time of the mortgage cannot exceed 40 years.
If I don’t have helps, can I change from variable type to fixed type?
The answer is yes. The Government and the banks have also agreed reduce commission expenses to facilitate the change from variable to fixed rate. In addition, during 2023 the commissions for early repayment will be eliminated.
Will all banks offer these aids?
It is not yet known. The idea is that yes, but for now it is unknown which entities are going to adhere to these new aids. Vice President Nadia Calviño has asked the banks to join them, since membership is strictly voluntary. Everything indicates that it will be the majority of the sector, but for now there is nothing official.
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