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Spain to approve mortgage support for more than 1 million households

The Spanish government will approve mortgage relief measures, such as extending loan repayments for up to seven years, for more than one million vulnerable households and middle-class clients on Tuesday, the economy ministry said on Monday.

The ministry said the new measures would be adopted pending final negotiations with Spanish banking associations.

In Spain, around three-quarters of the population are homeowners, with most opting for floating-rate mortgages, which are more exposed to accelerated interest rate rises.

Under the framework, banks will provide mortgage support for vulnerable households through amended conditions in the industry-wide code of good practice.

The income threshold for allowing vulnerable households to receive support measures has been set at three times the Spanish IPREM wage index, which is equivalent to 25,200 euros, the ministry said.

The IPREM serves as a legally prescribed reference for the granting of subsidies and public aid and for eligibility for unemployment benefits.

The government will additionally implement a new code of good practice for vulnerable middle-class clients, setting the threshold at less than 29,400 euros.

The mortgage relief is expected to come into effect next year.