In recent years, the Spanish financial system has made heavy use of New Code of Good Practices to alleviate the mortgage burden of the households most exposed to interest rate hikes. Between 2022 and 2024, the entities processed around 7.500 transactions under this regulatory framework, with a combined volume of close to 860 million euros.
This data comes from the report "The contribution of the banking sector to economic growth and the progress of society"Prepared by the banking associations AEB, CECA and Unacc, the document focuses on how these specific codes have served as a safety net for families in vulnerable situations, especially in a context of soaring Euribor rates and more expensive financing.
What is the Code of Good Practices and who does it protect?
The study notes that in Spain, two versions of the Code of Good Practices aimed at mortgage borrowers with payment problems. The first was approved in 2012, in the midst of the financial crisis, and was updated in 2022; the second was launched precisely in 2022, in a scenario marked by inflation and the rapid rise of official interest rates.
El 2012 code It is aimed at those on the so-called "exclusion threshold," that is, households with serious difficulties in meeting their mortgage payments on their primary residence. Its main objective is to enable a viable restructuring of mortgage-backed debtso that the quotas approach a assumable mortgage for each family.
Since its launch more than a decade ago, and following the review of its conditions in 2022, this framework has enabled that Around 70.000 families have renegotiated their loans with your bank. In practice, this translates into longer repayment terms, interest rate adjustments, or changes in terms to ease the monthly pressure.
El code approved in 2022This second package of measures, meanwhile, targets debtors considered at risk of vulnerability, a somewhat broader category than the exclusion threshold. It focuses less on deep restructuring and more on offering Flexibility to adapt mortgages to a high interest rate environment.
The options considered include the switching from variable to fixed rate mortgages and the possibility of making full or partial repayments on variable-rate loans without incurring fees. These alternatives aim to limit households' exposure to future Euribor increases, while also allowing them to make advance payments when their finances permit.
7.500 transactions and 860 million under the new framework
According to figures collected by AEB, CECA and Unacc, between 2022 and 2024 financial institutions have managed some 7.500 operations adhering to the new Code of Good PracticesThe total cost of these actions is around 860 millones de eurosThis gives an idea of ​​the volume of mortgages that have been modified or refinanced within this scheme.
These actions are not limited to a single type of measure: they range from renegotiations of installments and terms This includes changes to the applied interest rate or penalty-free amortizations. The common denominator is that all are carried out under the conditions and safeguards stipulated in the codes, which establish access criteria and guidelines to guarantee consistent treatment.
Banking associations emphasize that the use of these codes has been concentrated during the period of most significant increase in financing costs. However, they insist that the The mechanism remains available. for those who meet the established vulnerability or risk requirements and need a break on their mortgage.
In terms of added impactThese 7.500 operations are in addition to the history of interventions of the original code, which since 2012 had already helped tens of thousands of families to save their primary residence or keep their payments at manageable levels.
The employers' report indicates that these figures may not reflect all agreements reached between banks and clients, as they are often negotiated individual solutions outside the formal framework of the codes, but in line with their spirit of protecting the vulnerable debtor.
The role of the ECB and the Euribor in triggering the measures
The widespread adoption of these tools from November 2022 onwards is largely explained by the rapid shift in the monetary policy of the European Central Bank (ECB)To contain inflation at multi-decade highs, the agency initiated a rapid rise in official interest rates, which had an immediate effect on the cost of variable-rate mortgages.
During 2022, The 12-month Euribor went from negative values ​​to above 2%. in just a few months. This jump resulted in upward revisions of mortgage payments for millions of Spanish households whose loans were linked to this index.
The upward trend continued and, by 2023, the Euribor had reached close to 4%This has created a much more demanding financing environment for families. The impact was especially noticeable among holders of variable-rate mortgages with lower incomes, who saw their monthly payments increase significantly.
Faced with this situation, the Government and the financial institutions agreed Strengthen and expand the Codes of Good Practice to offer a safety net to the most vulnerable debtors. It was in this context that the use of the new 2022 code was promoted, complementing the existing one from 2012.
The agreed measures included from temporary freezes of quotas ranging from deeper debt restructurings to the option of converting variable-rate loans into fixed-rate ones to gain long-term stability. The priority was to prevent the rise in interest rates from translating into a drastic increase in defaults and a deterioration of the social situation of the most vulnerable households.
Reduction of the financial burden on households
Beyond the number of specific transactions, banking associations emphasize the evolution of a key indicator: the percentage of households with a financial burden considered highAccording to the report, between 2022 and 2024 this percentage would have decreased from 4,6% to 4,1%.
The decline is even more pronounced in the population segment with lower incomeIn the lowest income quintile, the proportion of families with a high financial burden would have fallen from around 12% to below 10% in the same period analyzed.
Banking associations attribute this improvement to a combination of factors: on the one hand, the direct effect of the operations covered by the codes, which alleviate the monthly burden on struggling households; on the other hand, a macroeconomic context that, despite inflation and rising interest rates, has shown some resilience in terms of employment and activity.
In any case, the report emphasizes that the purpose of these mechanisms is avoid situations of unsustainable over-indebtednesswhich could lead to mass defaults or loss of housing. Therefore, the measures are focused on those groups that meet strict vulnerability criteria.
The financial sector argues that the application of the codes has contributed to moderate the social impact of the rise in interest rates in Spain, in contrast to previous scenarios in which the institutional safety net was smaller and the consequences of crises fell more heavily on mortgage debtors.
Taking into account both the 2012 and 2022 codes, the set of actions shows a increasing use of mortgage relief tools which, according to employers' associations, has helped to cushion the adjustment and keep the banking system and families in a more balanced position.
The experience of these 7.500 transactions linked to the new Code of Good PracticesThese figures, added to the nearly 70.000 families who have renegotiated their mortgages since 2012, paint a picture in which specific regulations and collaboration between banks and administrations have become key to managing periods of financial stress and offering a way out for debtors in difficulty without resorting to traumatic solutions.
