The lack of available savings is one of the main reasons for not buying a home today. In fact, according to a study carried out by Rastreator on access to housing, around 30% of Spaniards affirm that they have not yet taken out a mortgage because they cannot afford to enter, which in most loans usually supposes a 20 % of furniture price
In an economic moment in which the increase in the cost of living makes it increasingly difficult to save, mortgages in which the bank finances a greater percentage of the value of the property are attractive for people who cannot contribute a sum of high money at the time of signing the loan for the acquisition of housing.
100% of the appraised value requires higher solvency requirements than conventional mortgage loans, in addition to some additional conditions at the time of signing. For example, most of these mortgages require the contracting of other products such as payroll direct debit, insurance or credit cards. In addition, the conditions for these mortgages usually include higher interest rates and longer repayment terms.
The main danger of this type of mortgage is that, since the amount lent by the bank is greater, the possibility of indebtedness increases. In addition to the fact that the initial capital of the financing is greater, the bank will increase the interest for assuming more risk, and the client may end up paying a much higher fee than expected.
95% mortgages are available in the market
The INCREASE of Interest Rates and the rise in the Euribor, which closed in July at 4,149%, a figure that had not been reached since 2008, have caused banks to be more reluctant to offer this type of loan due to the greater uncertainty about the customers’ ability to pay.
In fact, today it is practically impossible to find a 100% mortgage, despite the fact that only a few months ago there were entities that marketed this type of loan. HelpMyCash. Bankinter, Deutsche Bank or Hipotecas.com, for example, could consider financing more than 95% of the purchase of the habitual residence to very safe profiles such as officials or other types of endorsements or guarantees, but the conditions were obtained from the agreement that was reach with entities. Other entities, such as Santander, would be willing to finance 100% if a home is purchased from their real estate portfolio.
On the other hand, there are offers for young people under 35 who want to buy their first home and do not yet have the savings to take out a traditional mortgage. Banks such as Kutxabank or Cajasur, for example, offer variable mortgages of up to 95% financing over 30 years, with differentials over the Euribor of 1.39% in non-linked mortgages and 0.39% if they are signed with bonuses.
Ibercaja and Banco Santander, on the other hand, could finance up to 95% of the value of the home, with subsidized differentials of 0.60% or 1.10%, respectively, to which the reference index would have to be added. Ibercaja also offers a term of 25 years, 5 years below the market average.
As for fixed mortgages, Ibercaja also offers to finance up to 95% of the first home of young customers, with an interest rate of between 3.25% and 4.25% depending on the products contracted and a term of 25 years. Banco Santander’s Young Fixed Mortgage, on the other hand, has a subsidized interest rate of 3.23% over 30 years and could finance up to 95% of the purchase.
Government aid to the mortgage
Some autonomous communities additionally offer aid to young people who meet certain economic requirements for the acquisition of their first home. Although most are tax discounts, there are current mortgage guarantees for people under 35 with little savings in communities such as the Balearic Islands (which guarantees up to 20% of the value of the home), Galicia (20%), Murcia (20%), Castilla y León (17.5%) and Madrid (15%), with which you can sign a mortgage in which the down payment represents less than 20% of the price of the property.
As an example, the ING bank has recently announced that it will join the entities Caixabank, Ibercaja and Santander and will link its Orange Mortgage to the ‘My First Home’ program of the Community of Madrid. Thus, young people from Madrid who can demonstrate their solvency and who wish to buy a home for less than 390,000 euros within the autonomous community will be able to do so with 95% financing, since the regional government will guarantee an additional 15% to the 80% that it finances. usually the bank.
120,000 euros. This help, which would allow access to a 100% financing mortgage, however, will only be available to those who did not earn a gross income of 1,800 euros per month and live in a municipality with less than 10,000 inhabitants, excluding the main cities. Spanish
