The Government of Spain approved a new line of financing this Tuesday, managed by the Official Credit Institute (ICO), with a budget of 10 billion euros, which will allow for interest-free loans of up to 50,000 euros to individuals looking to purchase their first home.
The President of the Government, Pedro Sánchez, explained after the Council of Ministers that the measure is designed especially for those who can afford a mortgage but have difficulties saving for the down payment. The initiative will be intergenerational, so it will not be limited solely to young people.
The mechanism, known as TU CASA, aims to complement private mortgage financing.
According to the regulatory text used as the basis for the measure, public lending may cover the lesser amount between 20% of the property's value and 50,000 euros.
This means, for example, that a home valued at 200,000 euros could receive up to 40,000 euros through this method, while a home valued at 300,000 euros would still have a limit of 50,000 euros, even though 20% amounts to 60,000.
The financing will have a 0% interest rate and will not charge any fees. The loan may be granted for a term of up to 10 years and includes a grace period linked to the term of the mortgage, with a maximum of 30 years.
The measure is aimed at those purchasing their first mortgaged primary residence. Therefore, it is not a non-repayable grant or financing intended for second homes or investment properties.
Sánchez insisted that the program will not be reserved solely for minors of a certain age. "It will be intergenerational," he stated, noting that young people, families, and older individuals who are accessing home ownership for the first time and meet the conditions that will ultimately be established will be able to benefit.
For Cubans residing in Spain, this measure may be particularly relevant if they are in a position to apply for a mortgage and are looking to purchase their first permanent home.
However, it cannot yet be stated that any resident Cuban will be able to gain automatic access, as there are still requirements to be established such as possible income limits, residency conditions, solvency criteria, and the application process.
That point is important. Although the Council of Ministers has once again approved the creation of the mechanism, the detailed development of beneficiaries, limits, and other conditions is still pending. The regulation used so far stipulates that these aspects must be specified through a subsequent agreement by the Council of Ministers.
Therefore, loans will not necessarily be available starting this Tuesday at the bank branches. First, the operational conditions must be published and developed, along with the procedure for applying for them and how the ICO will coordinate the financing with private entities.
The measure also has an important characteristic: the homes purchased through this instrument will be subject to a maximum transfer price, according to the regulations announced by the Government.
The program returns to the spotlight after Congress rejected on October 2 the two housing decrees approved days earlier by the Executive.
Those regulations were repealed after failing to pass parliamentary validation, which is why the Government decided to approve two new royal decree-laws this Tuesday that, according to Sánchez, retain the essence of the previous ones while incorporating modifications.
Among these announcements is precisely the funding of 10 billion euros for YOUR HOME.
The Executive asserts that the main problem for many potential buyers is not managing a monthly mortgage payment, but rather gathering the necessary savings to make the down payment.
The line is part of a broader package of housing measures that also includes 280 million euros in guarantees to promote industrialized construction and 400 million for social housing suppliers, alongside other initiatives related to rentals and the expansion of the public housing stock.
The key for potential beneficiaries will now be the final publication of the new decrees and the program development rules.
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