Last week, the decree-law extending the interest subsidy on housing loans was published, stating that both the change that extends the conditions for accessing the interest subsidy and the amount of interest paid by the State are retroactive to January.

In other words, the diploma expands, with effect from January, the universe of people who benefit from subsidised interest and, at the same time, those who already benefit can receive more.

When asked about the topic and how citizens will have access to increased support, with effect from January, the Ministry of Finance responded today that "the new interest subsidy rules are retroactive to January 1, 2023. This means that the amounts will be paid due according to the new rules, since that time".

The office led by Fernando Medina did not detail how these payments will be made, saying only that the procedural protocol is being reviewed with the banks for the new rules to be operationalised.

According to the decree-law, the bonus started to be calculated for the index value above 3% (regardless of the contracted rate) and was no longer made according to income brackets. However, only taxpayers up to the 6th IRS bracket (up to 38,632 euros of annual taxable income) and whose financial assets are less than 62 Social Support Index (around 29.7 thousand euros in 2023) continue to benefit from this measure.

The State subsidizes 75% of interest above 3% for effort rates (of housing loans in relation to income) between 35% and 50% (previously it was 50%) and 100% (previously it was 75%) for effort rates above 50%.

The maximum amount of support increases from 720 euros to 800 euros per year but, according to the decree-law, this increase in the maximum amount is not retroactive to January, having only come into force last week.

At the end of 2022, according to Banco de Portugal, banks had around 1.5 million home loan contracts in their portfolio (variable rate, fixed rate or mixed rate). In July this year, according to Banco de Portugal, there were two million customers with mortgage loans.

In the State Budget proposal for 2024, the Government predicts that next year the interest subsidy will cover 200,000 credit contracts and cost 200 million euros.