Bankinter signs up to the ICO guarantee facility for purchases of first homes by young people and families

Bankinter's head of commercial retail banking, Ignacio Lozano, the Secretary of State for Housing and the Urban Agenda (MIVAU), David Lucas, and the president of ICO (the Official Credit Institute), José Carlos García de Quevedo, signed an agreement today in which the bank will promote the guarantee facility granted by the Ministry and managed by ICO for purchases of first homes as the main and permanent residences for young people and families with children.

This 2,500-million-euro facility aims to open up access to housing for people who are financially solvent and have the capacity to repay a loan but do not have sufficient savings to get a mortgage to buy their first home.

Ignacio Lozano, head of commercial retail banking at Bankinter, said at the signing ceremony that “Bankinter is a leader in the mortgage business, where it offers innovative products, such as its Dual mortgage and special financing conditions for younger customers, with a mortgage loan book of 35,600 million euros at the end of the first half of 2024. This collaboration with MIVAU and ICO will foster access to housing for young people and families with children, and will help boost the growth of our business”.

Secretary of State David Lucas highlighted the importance of this agreement, because it helps with the “penultimate step” before thousands of young people and families with children can get a mortgage. Mr Lucas said that housing is a public concern to which governments must respond, and “that is what the Spanish government is doing”. “Mobilising resources, pulling levers, harnessing all the powers of the state to guarantee the public's constitutional right to decent and affordable housing”.

The MIVAU guarantee, which will be free for customers and banks, may cover up to 20% of the mortgage, or 25% when the home has a D or higher energy rating. The bank will fund the remainder of the mortgage.

This measure will enable homebuyers to pay the balance over the maximum 80% of the lower of the purchase or appraisal value of the property usually financed by banks in mortgage transactions.

The MIVAU guarantee will be valid for 10 years from the date of the mortgage, regardless of any grace periods the customer may have agreed with the bank or whether the mortgage term agreed between the customer and the bank exceeds ten years.

This measure is aimed at young people under 35 years of age and families with children, whose income, in both cases, is less than 4.5 times the IPREM monthly public income index for each holder.

The measure also includes some refinements. For example, the limit established based on the IPREM will be increased by 0.3 times (gross 2,520 euros per year) for each child; and the limit may be increased by an additional 70% for single-parent families.

The period for taking out the mortgages under this guarantee facility ends on 31 December 2025, with the possibility of extending this period until 2027.