Since 2012, there is a set of standards known as the Code of Good Practices which aims to help alleviate the financial burden of those mortgage debtors who find themselves in a vulnerable situation due to factors such as inflation, rising interest rates or an economic crisis.
It is important to highlight that adherence to the Code of Good Practices is of a voluntary by banks. This means that each entity has the option to accept the code and, once it has done so, it will be obliged to apply the measures established in it. It should also be mentioned that, until the end of 2024, mortgage debtors have the additional measures of a new specific Code that has been implemented for those who have been affected by the increase in the Euribor.
How to avoid commissions
The new law of help to vulnerable mortgage debtors (Royal Decree-Law 19/2022) gives you the opportunity to save money this year, exempting you from paying commissions. Although this measure was designed to ease the financial burden on struggling families, all mortgagors can take advantage of this opportunity, regardless of income.
During the year 2023, it has been established that certain commissions related to mortgage loans will not be charged. These exemptions apply to two specific situations:
Interest rate change: Commissions may not be charged for changing a variable rate mortgage loan to a fixed rate. This means that, if you are the holder of a mortgage loan with a variable interest rate and you wish to change it to a fixed rate to obtain greater stability in your monthly payments, the bank will not be able to charge you commissions for making this change.
Refunds or redemptions: Likewise, no commissions or compensations may be charged for making total or partial refunds or amortizations in variable-rate mortgage loans. This means that if you decide to make advance payments to reduce your mortgage debt, either totally or partially, the bank will not be able to charge you additional commissions for these operations.
These measures are intended to give a financial relief for debtors mortgages during the year 2023, facilitating flexibility and the possibility of adapting your mortgage loans to your needs and economic circumstances. It is important to note that these exemptions apply specifically during this year and may be subject to changes or additional conditions established by current legislation.
use the simulator
Recently, the Bank of Spain has launched a simulation tool designed to assist those who have a mortgage. Its objective is to verify if they meet the necessary requirements to benefit from the measures established in the Codes of Good Practices.
This tool is a simple and practical way of assess whether the mortgaged can qualify to these measures and thus obtain financial relief. If you have a mortgage and want to know your options, this simulator gives you the opportunity to explore the possibilities that might be available to you.
The Bank of Spain simulator takes into account various relevant data to determine if you meet the necessary requirements to benefit from the measures included in the Codes of Good Practice. Some of the factors considered are:
Banking entity: You must select the entity in which you have your mortgage loan, since the measurements may vary depending on the bank.
Type of mortgage and housing: You must indicate if your loan is a mortgage with a mortgage guarantee for a habitual residence. In addition, it is evaluated if the price of your home is less than €300,000 and if the mortgage was formalized before December 31, 2022.
Monthly fees: You must provide the amount of your current monthly installment and also the amount of the installment 4 years ago. This data helps determine the evolution of your payments over time.
Economic requirements: Information is requested on the annual gross and annual net income of your family unit. It is also evaluated if any member of the family unit has a disability, dependency or illness that makes them unable to work. Likewise, it is considered if you are a person with a recognized disability or if you belong to a large family, a single-parent family with dependent children or if you have at least one minor in the family unit.
Other special circumstances: The simulator also takes into account situations such as the coexistence of people with disabilities, dependency or serious illness in the same home, the existence of victims of gender violence or trafficking or sexual exploitation in the family unit, and if the debtor is a person older than 60 years.
Taking these data into account, the simulator will offer you an evaluation of whether you meet the conditions to benefit from the measures of the Codes of Good Practice and thus obtain financial relief in relation to your mortgage this year.