A leading financial institution in Spain has introduced an intriguing new offer on the country’s real estate market. CaixaBank has launched a fixed-rate mortgage program that could become one of the most attractive options in 2025 for those planning to buy a primary residence.
The centerpiece of the offer is an annual interest rate of 2.85% (the total effective cost, or TAE, is 4.259%). However, to secure this favorable rate, borrowers must meet a number of conditions. The bank requires clients to have their salary or other regular income deposited with CaixaBank, as well as to sign up for several additional products. These include a home insurance policy as well as life or health insurance. The final requirement is the installation of a security alarm system in the purchased property. If the client declines any of these options, the interest rate is automatically raised by one percentage point, rising to 3.85% (TAE 4.319%).
A key advantage of this mortgage program is the absence of fees for application opening and processing, allowing borrowers to save on initial expenses. However, it’s important to pay attention to the terms of early repayment. Legislation in this area strictly regulates possible penalties. During the first ten years of the contract, the bank has the right to charge a commission of up to 2% of the early repayment amount, but only if this results in financial losses for the lending institution. After this ten-year period, the maximum penalty drops to 1.5% of the repaid amount and remains in effect until the mortgage is fully paid off.
Regarding the financing amount, CaixaBank is willing to cover up to 80% of the lower value between the appraisal and the market purchase price. This is standard practice for Spanish banks. It’s important to note that this offer applies exclusively to the purchase of a primary residence and cannot be used to acquire a second home or a vacation property. The maximum loan term is 30 years. There is also an age restriction: by the end of the loan repayment, the borrower must not be older than 80 years.
