First-home mortgage (mutuo prima casa): requirements and how to get one, including for under-36s and at 100%

What is a first-home mortgage in simple terms?

A mortgage is a loan the bank grants you to buy a home. You repay it in instalments, usually monthly, with interest. To secure the loan the bank registers a mortgage (ipoteca) on the property: if you stop paying, it can ask for the property to be sold.

A mortgage secured by a lien on the property is called fondiario (art. 38 of the Testo unico bancario). As a rule it goes up to 80% of the value of the property.

The bank does not always use the price you have agreed with the seller. It takes the lower of the price and the bank's appraisal report. To learn how to read this appraisal, see what the bank's appraisal checks.

Example. A property worth €100,000, with a mortgage up to 80%: €80,000 of loan. The remaining €20,000 is yours to pay, together with the purchase costs.

What requirements does the bank ask for?

There is no single list of requirements valid for all banks. In general the bank checks a stable income, the debts already in progress and your ability to meet the instalment for years.

Before you sign, the bank must assess your creditworthiness (merito creditizio), that is, your reliability in repaying the loan. To understand how much you could get based on your salary, read how much mortgage your salary can get you.

Under 36: what changes with the Consap Fund?

The First-Home Guarantee Fund (Fondo di garanzia per la prima casa) is a State guarantee managed by Consap. It covers part of the bank's risk. For the first home it guarantees mortgages up to €250,000.

There are two guarantee percentages:

• ordinary guarantee of 50% of the principal portion, that is the part of the debt you repay net of interest;
• 80% guarantee for priority categories: under-36s, young couples, single-parent families with minor children and allocatees of IACP public housing, with an ISEE not above €40,000.

Age alone is not enough. You must fall into one of the priority categories and meet the ISEE limit. The 80% guarantee has been extended to 31 December 2027 by the 2025 budget law. The current requirements may change, so check them on the Consap website before you apply. For details, read Consap mortgage for under-36s.

The Fund also applies if you buy at auction, because it guarantees the mortgage, not the type of sale. At an auction, however, the balance must be paid within 120 days of the award. The bank's timing must fit within that deadline, so the application should be started before the auction.

100% mortgage: is it really possible?

It is possible, but it is not a right. Financing reaches 100% of the value only with supplementary guarantees, such as a guarantee (fideiussione), where a person guarantees the debt if you do not pay, or the Consap Fund. The decision rests with the bank, case by case.

Do not be guided by the headline alone. Always ask for a simulation based on the appraisal value. To understand who can really obtain it, read 100% mortgage: who can get it.

How much tax relief is there on a first-home mortgage?

You can deduct 19% of the interest paid on the first-home mortgage from IRPEF, up to €4,000 of interest a year. The maximum deduction is therefore €760.

Example. If in one year you pay €3,000 of interest, the deduction is €570. The deduction covers only interest, not the principal portion. Keep the certificate the bank sends you each year on the interest paid.

For the first home there is also the substitute tax on the mortgage (imposta sostitutiva sul mutuo): 0.25% of the amount disbursed, against 2% in other cases. On an €80,000 mortgage that is €200.

Do you have to move your residence?

The residence rule does not come from the mortgage but from the first-home tax relief: registration tax (imposta di registro) at 2% instead of 9%. To get it, the home must be in the municipality where you have your residence or where you work. If you are not yet resident there, you must transfer your residence within 18 months of the purchase. In addition:

• you must not own, alone or with your spouse, another home in the same municipality;
• you must not already have bought another first home in Italy with the relief. If you have, you must sell it within 2 years.

If you sell the home within 5 years without buying another first home within 1 year, or do not transfer your residence within the 18 months, you lose the relief. In that case you pay the difference in tax, plus a 30% penalty and interest.

How do you apply for a mortgage, step by step?

1. Work out how much you can ask for with a simulation based on your income and the value of the property.
2. Compare the offers by looking at the TAEG, that is the total cost of credit as an annual percentage, which includes interest and charges. The difference from the TAN is explained in TAN and TAEG rates: the differences.
3. Submit the application. The bank carries out the assessment (istruttoria) and checks your creditworthiness.
4. The bank has the property valued with its own appraisal report.
5. Before signing there is a cooling-off period. You will find the exact term in the document the bank gives you.
6. You sign the mortgage contract before a notary, in the notarial deed (rogito). The bank registers the mortgage as its security.

Can I change my mind later?

To some extent, yes. For mortgages taken out from 2 February 2007 by individuals to buy a home, early repayment is free of penalties (art. 120-ter of the Testo unico bancario). You can also change bank through portability (surroga), which is free (art. 120-quater).

Frequently asked questions

Can I get a first-home mortgage if I am under 36?

Age alone is not enough. If you fall into the priority categories and your ISEE does not exceed €40,000, the Fund's guarantee reaches 80%. The bank still assesses your income and existing debts.

How much can I ask for as a first-home mortgage?

As a rule up to 80% of the value of the property. With supplementary guarantees you can reach 100%. The Consap Fund guarantees first-home mortgages up to €250,000.

Can I repay my mortgage early without penalties?

For mortgages taken out from 2 February 2007 by individuals to buy a home, yes: early repayment is free of penalties. Still, check the contract for the details.

In practice

• Run a mortgage simulation starting from the appraisal value, not just the price.
• Compare at least two offers by looking at the TAEG, not just the rate.
• If you are under 36, check the current requirements and your ISEE on the Consap website.
• Before signing, read the cooling-off period stated in the bank's document.

Sources

• Consap: First-Home Guarantee Fund
• Bank of Italy: guide «Buying a home: the mortgage»
• Law 147/2013, art. 1 paragraph 48 (First-Home Guarantee Fund)
• Presidential Decree 917/1986 (TUIR, deductions for mortgage interest)