They plan to use public money to pay mortgage interest to the bank

The ICO (Spain's state credit agency) guarantee line is a guarantee on part of the principal, not an interest payment: public money only appears if the borrower stops paying. Subsidising mortgage interest is a different instrument and would require legislation with its own funding.

A post on X signed by **Lorenzo Ramírez** sums up the matter this way: “Now they're going to use public money to pay mortgage interest to the bank.” It does not specify the measure, households or amount. It is worth separating the pieces: who lends, who collects and who takes on the risk.

## Public guarantees do not pay interest
The **ICO** has run a guarantee line since 2023 through which the State backs up to **20%** of a mortgage's principal. It does not cover the instalment or the interest: it is a guarantee. If the borrower pays, it costs nothing; if they stop paying, it is liable to the bank and only then does public money come out.

## What the bank takes on
The **Código de Buenas Prácticas** (Spain's mortgage relief code), signed with the banking sector in **November 2022**, requires restructuring debt for vulnerable households: principal payment holiday, lower rate and longer terms. The lender takes this on, not the taxpayer. In severe cases a write-off is added, part of the loan that is not repaid.

## Subsidising interest is another matter
Paying interest from the public budget is a different instrument from the guarantee and the write-off. There is no general programme like that in force in Spain: it would require legislation with funding and beneficiaries.

When facing an unaffordable mortgage, it is wise to consult a professional before you stop paying the instalment.