Access to housing is one of the biggest concerns for the youngest groups in the population. High prices, job instability and difficulties saving enough to meet the initial expenses derived from the purchase are obstacles that sometimes seem impossible. Help, in these cases, comes from youth mortgages.
What are youth mortgages?
It's a mortgage loan for people between 18 and 35 years old. Youth mortgages offer more favourable conditions to qualify for the financing they need to purchase a home. However, it is necessary to meet some requirements.
Advantages of youth mortgages
The differences concerning a conventional mortgage are reflected in several aspects, although some of them may vary slightly from one banking entity to another:
Financing
Banks do not usually finance more than 80% of the appraisal price of the property. Youth mortgages raise this percentage to 90 - 95% (sometimes up to 100%), although this requires a guarantor.
If this is not possible, there is the possibility of requesting public guarantees to obtain this 100% financing, either from the ICO or from the autonomous communities that have housing access plans for young people.
Repayment period
As youth mortgages are for people under 35 years of age, it allows extending the repayment period to 35 or 40 years. In exchange, the entities usually require contracting a variable interest loan.
Interests
Youth mortgages can also offer advantages in this respect. That's reflected in a slightly lower mortgage spread, although only up to a certain age.
Linked products
It is common for banks to offer bonuses on mortgage loans in exchange for taking out products such as insurance or pension plans. It's not the case for youth mortgages.
Additional aid
In addition to these advantages of youth mortgages, some regions offer aid beyond these guarantees to cover the part not financed by the bank. These aids generally translate into a reduction in the Property Transfer Tax paid when what is acquired is a second-hand home.
Requirements for applying for a youth mortgage
Beyond age (not exceeding 35 years), other requirements are necessary or advisable to meet to access youth mortgages:
• Stable job: banks consider this when granting mortgages, even for young people.
• Income: the monthly mortgage payment should not exceed 30-35% of the net income of the family unit.
• Savings: even when getting 100% financing, there are always expenses that must be assumed when purchasing a home (taxes, notary, registration, etc.).
If you are looking for your first home, go to Spainhouses.net to find that home that will allow you to become independent or stop paying rent. Check if you meet the requirements to apply for a youth mortgage and take the first steps to fulfil your dreams.