The prospect of a drop in ECB rates is (finally) giving some breathing space on the financing costs front. To support those who need to take out a mortgage, if it is a first home, there is the instrument of the Guarantee Fund for first home mortgages, which favors access to bank credit for the purchase – or for purchase and renovation for energy efficiency – of the first home for the benefit of citizens who do not own other residential properties.
Abi, the Association of Italian Banks, has released a new guide on the functioning of the mechanism, which was strengthened during the pandemic to give particular support to young people. Here are the main points.
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edited by the Economics editorial team
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How does the fund operate?
Releasing guarantees equal to 50% of the principal amount on mortgage loans disbursed for an amount not exceeding 250 thousand euros.
How do you access it?
In general, explains the Abi, There are no income limits for borrowers to access the Fund’s guarantee. Specific concessions are, however, provided for categories of customers identified as “priority” such as in particular:
- young people and young couples, with borrower under the age of 36;
- tenants of accommodation owned by the IACP;
- and single-parent families with minor children.
The strengthening of guarantees
For these subjects – within the limits of an ISEE of 40 thousand euros – until 31 December 2024 it is envisaged that, if the amount of the mortgage is greater than 80% of the price of the property to be purchased, the Fund’s guarantee can reach up to 80% of the principal amount of the loan. For large families the guarantee can instead reach up to 90%.
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In fact, among the categories of borrowers with priority in accessing the Fund are also families with the following characteristics:
- with three children under the age of 21 and an equivalent economic situation indicator (ISEE) not exceeding 40,000 euros per year;
- with four children under the age of 21 with ISEE not exceeding 45,000 euros per year. In this case the maximum coverage percentage can reach 85%;
- with five or more children under the age of 21 with ISEE not exceeding 50,000 euros per year. In this case the maximum coverage percentage can reach 90%.
The rate
For mortgages to which priority has been assigned, the maximum limit of the effective global rate (TEG) applicable to mortgages is equal to the average effective global rate (TEGM) on mortgages, as reported in the quarterly publication of the Ministry of the Economy. For priority subjects, the increase in coverage is also recognized in cases where the TEG is higher than the TEGM by the maximum amount established by law. For them, then, the guarantee remains active in the event of subrogation of the loan originally taken out for the purchase of their first home.
As you ask
To request to take advantage of the measure, you must complete the form published on the Consap website, which manages the Fund (www.consap.it/fondo-prima-casa/) and present it to one of the banks and financial intermediaries participating in the initiative, the list of which is available on the Fund manager’s website.
