If a mortgage carries a variable interest rate, many households have noticed the higher payments that come with rising rates. Those increases, paired with soaring housing prices and persistent inflation, can strain family budgets and daily living. Financial relief programs exist to ease this burden, and governments have introduced measures designed to help people meet their mortgage obligations while staying on track with other essential expenses.
In response, authorities have rolled out a framework of support aimed at reducing monthly mortgage payments for eligible households. Banks have agreed to apply these measures through clear, mutually accepted practices. The goal is to provide relief without compromising the lender’s financial stability. Eligibility, however, hinges on meeting a set of conditions that ensure the assistance reaches those who truly need it.
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Where a mortgage exists on a home with a purchase price not exceeding 300,000 euros, and the household income is below 3.5 times the IPREM (roughly 29,400 euros per year up to 2023), while mortgage payments exceed 30% of income and the loan’s installment shows a notable increase (20% or more), there are two years of potential relief. This includes adjustments to payment schedules, caps on increases, and monitoring to ensure affordability aligns with income trends.
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A freeze on mortgage payments for a period of 12 months can be granted, providing breathing room during months of tighter budgets.
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The option to convert a variable-rate loan to a fixed-rate loan may be offered, bringing predictability to payments and shielding families from future rate shocks.
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Lengthening the repayment term by up to seven years can reduce monthly installments, helping households maintain other essential expenditures.
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If annual income falls below 25,200 euros (about 3x IPREM) and more than half of monthly income is devoted to mortgage servicing, with payment burden increasing, two additional years of relief can be requested.
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A two-year grace period or a payment break can be requested to re-balance finances during difficult periods.
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During any shortfall, borrowers may face a temporarily reduced interest rate to ease the overall cost of servicing the loan.
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The mortgage term can be extended by up to seven years, further reducing monthly payments and improving long-term affordability.
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Beyond payment relief, the ongoing cost of carrying a mortgage continues to take a larger bite out of household budgets. A higher share of monthly earnings may be committed to quota payments, and in some cases, a grace period could extend up to five years. During such breaks, the interest rate applied can be adjusted downward, potentially to Euribor minus 0.10%. The total repayment horizon may be extended up to 40 years from the loan date, providing longer-term relief if the restructuring plan proves viable. These measures help stabilize families’ finances while maintaining access to housing.
Other approved measures focus on the settlement process itself. If the initial restructuring plan is not workable, the window for negotiating relief can be extended to two years. If a borrower is eligible but facing temporary payment difficulties, options for a slower pace or additional restructuring can be explored. If hardship persists after the first grace period, another restructuring can be requested.
Additional steps address the administrative costs tied to changing loan contracts. Costs related to notary and registration duties, as well as other documented legal actions, can be reduced or exempted, depending on the specific plan and jurisdiction. Lenders are required to honor these rights even if the loan has been transferred to another institution.
Note that if the specified conditions are not met, borrowers always retain the option to repay the mortgage ahead of schedule or to request a rate conversion from a variable to a fixed rate with minimal or no commissions during the eligible year, subject to the bank’s policy. This safeguard ensures flexibility and ongoing access to affordable financing throughout the year.