Mortgage lending has regained strength in Spain during 2025, marking an upward trend not seen since the outbreak of the last financial crisis. With the drop in interest rates and a somewhat more favorable economic climate, banks have reactivated their offering of loans for home purchases, boosting both the granting of new loans and improving conditions for those seeking financing.
This scenario has been accompanied by a reduction in the cost of mortgage loans., which has led more families to consider purchasing their own home. Furthermore, competition among banks, buyer interest, and the possibility of negotiating discounts or eliminating certain fees are often key factors in finding a mortgage that truly suits each person's needs.
The evolution of mortgage credit in 2025
The figures reflect a notable increase in mortgage granting this year. In the first quarter of 2025 alone, banks approved nearly €19.500 billion in new home loans, an increase of around 25% compared to the same period last year, according to the latest data published by the Bank of Spain. Overall, the outstanding mortgage balance exceeds €500.000 billion after several years of decline, a clear sign of the recovery in home purchase credit.
The interest rate cut is a determining factorThe Euribor, the reference rate for most variable-rate mortgages, has fallen to just over 2%, lowering monthly payments for those with previous loans and providing an additional incentive for those seeking new financing. This decline translates, for example, into an annual saving of more than €1.500 for a typical €150.000 mortgage.
In addition, banks have relaxed conditions in many cases., both by reducing the rates they apply and by facilitating access to financing through lower pre-savings requirements or by relaxing the collateral requirements. This is a time when buyers perceive that purchasing a home may be more affordable, although rising prices in some areas also lead to certain caution.
Mortgage trends and types: fixed, variable and mixed
Mortgage credit is available primarily between fixed-rate, variable-rate, and mixed-rate loans, each with its own pros and cons. The choice between one product or another depends on personal preferences, financial situation, and expectations about future interest rate developments.
- Fixed mortgage: It maintains the constant rate throughout the life of the loan. This option offers the greatest peace of mind, as it is not dependent on market fluctuations. It is often preferred by those who want to avoid surprises and prioritize stability. In 2025, the interest rates on the best fixed-rate offers are around 2,30%-2,50% APR with bonuses, although there are also differences depending on the bank and the services contracted.
- Variable mortgage: Referenced to the Euribor (or another index), this means the rate can rise or fall depending on the market. Typically, they initially have a fixed rate for one year and then are paid based on the value of the Euribor plus a spread (for example, Euribor +0,49%). If the Euribor remains low, they can become very competitive, but there is a risk of rising rates in the future.
- Mixed mortgage: They combine an initial fixed-rate period (usually between 3 and 10 years) and then a variable-rate transition. They provide a stable rate during the first few years and greater flexibility thereafter.
When comparing offers, it's essential to consider not only the interest rate, but also the fees, associated products (such as insurance or direct debit), the amount that can be financed, and flexibility with early repayments. To offer better terms, banks often require the purchase of other products, such as home/life insurance, pension plans, or direct deposit of income, which can entail additional costs that should be calculated before making a decision.
Access requirements, bonuses and 100% financing
To qualify for the best mortgage terms, banks primarily value an applicant's job stability, demonstrable income, and previous savings level. Although most lenders finance up to 80% of the home's value, there are offers (especially for young people or first-time home buyers) that allow for coverage of up to 100% of the appraisal value. These 100% mortgages, however, are usually reserved for very solvent individuals or very specific circumstances (for example, purchasing a home in certain autonomous communities or through a state or private guarantor).
Applying for a 100% mortgage involves additional risks —it increases the monthly payment and the total interest to be paid—, but it can be attractive for those without a large savings cushion. Some banks, such as ABANCA, Unicaja, Ibercaja, and ING, offer this type of product in certain regions, although the conditions are usually more demanding.
On the other hand, interest rate bonuses can be obtained by meeting certain requirements. such as direct depositing your payroll, purchasing insurance, or linking investment products. The savings this represents must outweigh the cost of these additional products, so it's always advisable to review the fine print and use simulators before signing anything.
Helpful tips and things to review before applying for a mortgage loan
Before applying for a mortgage, it's a good idea to prepare your accounts carefully and compare all available options. Among the most repeated advice from experts are:
- Calculate the maximum fee you can comfortably afford (ideally no more than 30-35% of monthly net income).
- Save at least 20% of the property's value for entry, plus an additional 10% to cover taxes and operating expenses.
- Compare offers from several entities taking into account all costs (interest, commissions, associated products, etc.).
- Negotiate with the bank, especially if you have a solvent profileThere is often room to get interest rate reductions or eliminate certain fees.
- Review your financial history and make sure you have no outstanding issues or debts.The better the applicant's profile, the better the opportunities available.
- Consider using a mortgage broker or financial intermediary. specialized, which can help you get customized offers and facilitate the procedures.
Today's mortgage market offers multiple options for those looking to purchase a home. Thoroughly analyzing the terms, comparing and calculating all associated long-term costs is essential to choosing the most suitable mortgage.
