The 20-year-old has been heavily linked with a move to the Premier League this season, but the Andalusian club's director of football expects him to pen a fresh deal soon.
The 20-year-old has been heavily linked with a move to the Premier League, and although he was a target for Chelsea and Manchester City, it now appears that he will remain at the Spanish Liga outfit.
"Isco's contract renewal is in its advanced stages and should be signed shortly," Husillos said. "We will be here presenting Isco very soon. We will be here shortly to announce the renewal of his contract.
"It's not renewed as yet, but I think it will be very shortly. We understand it is virtually a done deal."
Goal.com understands the new contract will place Isco on approximately 58,000 euros per week, while he will pen a contract until 2018 that includes a buyout clause of 35 million euros.
"There are no sure things in football. Everything can change in an instant," Husillos said. "The club's intention and what Isco has stated is that he is going to stay here; he's going to renew his contract. Life can also throw up a lot of surprises. That is the most conclusive statement that the club can make on the issue."
The youngster has played a key part in the Andalusians' fine season to date, with his six goals helping the club advance to the knockout stages of the UEFA Champions League and to fifth place in La Liga, with Husillos admitting a move away from La Rosaleda could happen in the future.
"Isco has really taken off. He's a great player and they want him at a number of clubs," Husillos said. "He's a Spanish international. We intend to keep him at Malaga for as long as possible.
"Everyone wants to improve, and if he continues growing like this, he'll have to go to a legendary European club. That's understandable."