The Government expanded this Friday the scope of its loan program for young people aimed at financing the down payment for the purchase of a home. A support to break one of the critical points in access to real estate, which grants financing of up to 50,000 euros without interest, a long grace period, and now extends to new types of property.
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The program, officially Préstec Emancipació, was launched last year by the Institut Català de Finances (ICF) and the Agència de l’Habitatge de Catalunya. It has an annual allocation of 100 million euros and has been running for eleven months.
What is the age limit to apply for the loan?
Until now, young people between 18 and 35 years old could access the program. The Generalitat has raised the upper limit to 40 years. The difficulties in accessing housing mean that more and more years of savings are needed to be able to enter the real estate market. One fact that reflects this is that in the loans granted in the first year of the measure, the average age of the beneficiaries is 29.6 years, at the upper end of the range.
How much money is lent?
Up to 50,000 euros are lent, intended to support the down payment of a home, 20% of the value of the home. The rest, 80%, is financed with collaborating entities, including the major ones. The down payment loan is requested on the ICF website: first the application is made, and once approved, you must contact the banks adhering to the agreement to finance the rest.
On average, 36,342 euros are granted per beneficiary, with which homes with an average price of around 190,000 euros are financed.
What kind of home can be bought?
The goal is the purchase of the first home, which must become the beneficiary’s habitual residence. It can be second-hand or new construction. It must be located in Catalonia, have a valid occupancy certificate at the time of purchase, not have been previously classified as protected housing, and cannot be in the project or construction phase.
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In the case of new construction homes, conditions are relaxed so that the loan can be formalized even if the definitive cadastral reference is not available at the time of signing. Since in new construction the legal division of the building may not have been completed at signing, the lack of the cadastral reference could block the purchase.
The home purchased with public support has the qualification of protected housing, with a permanently limited price. Thus, in case of subsequent sale or rental, certain requirements must be met.
Is it valid for properties other than a home?
Starting in June, yes. This is another of the novelties announced this Friday by the Generalitat. The purchase of a parking space or storage room located in the same building as the home can be financed, even if they are not part of the same property registry.
What requirements must be met?
There are age requirements – being between 18 and 40 years old -, registration requirements – you must be registered in Catalonia – and income requirements. The gross annual income of the people who will live in the home cannot exceed 6.5 times the Catalonia Sufficiency Income Indicator (IRSC): 83,392.53 euros for one person and 85,971.60 euros for two. Applicants cannot have unpaid debts or significant debts.
What are the loan conditions?
The loan has no interest and the money is not repaid until the mortgage is paid off, so there is a grace period of up to 30 years.
