These mortgages are especially designed to give better conditions to young first-time buyers, since they receive financial support from government agencies under agreements with regional or local government.
The characteristics of this type of mortgages are as follows:
- They have a period of fixed interest from the outset (usually between three months and three years) and, subsequently, an interest rate tied to the EURIBOR plus a spread which is lower than for other types of mortgage.
- They habitually include a mortgage payment holiday.
- Repaymentterms are usually longer and even reach 30 or 40 years.
- In exchange for the subsidies, banks usually ask the first-time buyers to take out supplementary products, such as insurance, credit cards or pension plans.