A new government call to banks has been issued, urging stricter adherence to the precautionary mortgage relief plan. The Minister of State for the Economy, Gonzalo García Andrés, submitted a formal complaint to the organizations on Wednesday, emphasizing meticulous execution of the relief measures for households bearing mortgage debt. He noted that the ministry and the industry had agreed on this framework a year earlier, and urged financial institutions to process deposits and resolve customer requests more swiftly. Some commitments made so far remain unresolved, underscoring gaps between policy intent and practical delivery.
Latest figures from the Bank of Spain show that the relief program recorded nearly 42,800 applications from January through July. These are from families struggling with debt and seeking postponement of payments. The total volume of mortgage loans outstanding remains a small fraction of the market, and a similar pattern exists for loans meeting eligibility criteria that did not materialize as expected under the prior code of good practice. Roughly eight percent of requests have been approved to date, amounting to around 3,424 mortgages valued at approximately €480 million. About half of the applications remain unresolved, with roughly 21,400 cases awaiting decisions, while around 40 percent have been rejected, mainly because the applicants did not satisfy the requirements in about nine of ten instances.
The foreign affairs minister explained that the low intake is partly due to demands for stricter screening and the economy’s current performance. The government had earlier signaled a more rigorous application of the code, especially in light of the better employment outlook and households’ incomes. He stressed that it is crucial to have an instrument that is both well-implemented and capable of reaching eligible families, as discussed at a Deloitte and ABC conference. The state aims to ensure the plan can reach more people who need mortgage relief, while maintaining prudent eligibility standards and protecting fiscal sustainability.
The government has signaled ongoing plans to expand the relief program to cover more mortgage holders, using criteria aligned with the Bank of Spain and asset considerations. A central element of the proposed expansion involves raising the income threshold to broaden eligibility among middle-class households. Consequently, the program would extend the current cap from 29,400 euros (three and a half times the IMPREM reference) to the average income level of 37,800 euros. Additional changes are contemplated, including extending the duration of waivers on commissions for early loan repayment and changes from variable to fixed-rate mortgages, which were initially slated for 2023. The objective is to strike a balance between accessible relief and financial prudence while ensuring a stable, predictable environment for borrowers and lenders alike.
While García Andrés stressed the need for decisive action, his deputy echoed the call for banks to raise their responsiveness. The aim is to reduce the cost burden on borrowers and to ensure a fairer distribution of relief resources across financial institutions. The vice president highlighted that improving the efficiency of the relief scheme requires ongoing collaboration among banks, regulators, and the government. The underlying message is clear: a timely and principled expansion of the mortgage relief program benefits households and supports overall economic resilience without compromising the integrity of the financial system.