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CGD announces cut in “spreads” of families with subsidized mortgage interest rates

Caixa Geral de Depósitos (CGD) will cut the margin paid by families that comply with the government’s support measure to subsidize housing loans, announced on Wednesday May 24, Paulo Macedo, the bank’s executive president.

“For people with more fragile conditions, taking advantage of the defined framework for subsidized credit, we will make a review [do spread do empréstimo à habitação]analyzing case by case”, the executive president announced at the CEO Banking Forum, an annual event of SIC Notícias/Expresso, which brought together the five most bankers in the country on Wednesday, according to Jornal de Negócios.

According to Paulo Macedo, the cut in spreads —a way of “complementing the efforts of the Government”— will advance in the second half of 2023. The head of the public bank added that the measure represents a reduction of “up to 50 additional points” in housing loans for families with difficulties to pay the mortgage and who take advantage of the regulations of the new decree-law regarding subsidies.

Interest subsidy on mortgage loans. Who can order? How much and when will I receive?

The interest subsidy on housing loans, a measure announced in March, is aimed at all people with credit contracts for the acquisition or construction of their own permanent home up to 250 thousand euros, entered into until March 15 of this year, with variable or mixed interest rates, provided that at that time they are in a variable rate period. The measure is applied when these people have an effort rate with a significant increase (equal to or greater than 35%) and the Euribor rate equal to or three points higher than that initially contracted. It also applies when this effort rate is equal to or greater than 50%.

The measure was designed to support families up to the maximum limit of the sixth IRS income bracket — for those up to the fourth bracket, the subsidy is 75% of the increase in the mortgage payment caused by the increase in mortgage rates. interest; for those corresponding to the fifth and sixth tranche of income, it will be 50%. The maximum annual support can reach 720.65 euros.

Source: Observadora

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