“We expect exponential growth in demand”

The reverse mortgage of Banco Santander and Mapfre is on track to complete its second year of commercialization, in which They plan to close between 250 and 300 operations. The figure is above the transactions recorded last year, when they accepted about 200 applications and pushes the ‘joint venture’ to consolidate its alliance, which started in 2024 in the city of Madrid and, after a testing phase, it was gradually launched throughout Spain.

“Each mortgage is tailored to the client, which explains why the process is slow, a minimum of three months,” he explains. Trinidad Martín-Orozcogeneral director of Santander Mapfre Hipoteca Inversa to ‘La Información Económica’. After two years of operation, it makes a positive assessment, with the expectation that “demand will experience exponential growth.” “There is a profound lack of knowledge of the productas prejudices are eliminated, its demand will rebound, because it covers a need that exists at the moment,” he maintains.

The truth is that the reverse mortgage is not suitable for everyone. The signature of the agreement contemplates some requirements among which a value of Minimum home appraisal of 150,000 euros and that it is located in properties with high liquidity and low volatility, which makes its sale in all regions of Spain impossible. In fact, the zip code It is one of the reasons applications are denied. “We turned down quite a few,” he admits.

The reverse mortgage is aimed at people over 65 years of age that they are owners of the property, which must also be their habitual residence and there must be no financial burdens on it or the residence of people who do not appear as owners of it. In this specific case, they offer an initial provision of 10% of the appraised value and a monthly income. In this sense, Martín-Orozco assures that the average age of hiring In this first phase, they are around 84-85 years old, with two differentiated profiles.

On the one hand, there are those users below this range, who are in good health and looking for additional income to the pension to travel and, on the other, those who They have spent their savings and need financial help. Broadly speaking, the calculation of the income is made on 70% of the value of the property and 30% is reserved for the heirs.

The figure of the reverse mortgage, most popular in the Nordic countries, arrived in Spain in 2007coinciding with the last blows of the real estate bubble. However, the high number of litigations that the banking sector had to face as a result of their hiring had condemned to a practically residual offer, even though they are regulated by law. Now banks and insurers have opted to give them a second chance, but with caution.

Once the person dies, the heirs can release the burden mortgage by paying the entity the amount owedaccept the inheritance and put the home up for sale in order to pay off the debt or hand the home over to the bank directly. In addition to Banco Santander and Mapfre, they market reverse mortgages in Spain Caser Insurancewhich was a pioneer six years ago; or VidaCaixa.

The latest data from the General Council of Notaries throughout 2024 are They took out just over 300 mortgageswith a slight decline compared to the 364 registered in the previous twelve months. Data that is far from the peak of 2022, when they exceeded 549. Experts see a wealth in the future, especially in a country like Spain, where the Housing stands as the investment par excellence. It is estimated that about three quarters of the savings of Spaniards are in the brick. It is an ideal breeding ground for future demand for reverse mortgages to establish itself as an alternative tool to retirement pensions.