The economist Endika Alabort explains to us what the mortgage rate change entails, how it’s done… and whether it’s a good time to do it.
Euskaraz irakurri: Gomendagarria al da hipoteka aldagarria finko bihurtzea?
Facing the mortgage payment becomes a nightmare for many families, especially those who have ever signed a variable interest rate.
With inflation exceeding 10%, the interest rate at 1.25% and the Euribor above 2%, more and more people are opting to change their mortgage interest rate from variable to fixed. But beware, before you jump in the pool, keep in mind that it may not always be a good idea, as the economist warned Endika Alabortin an interview in eitb.eus.
His first warning is correct: “The banks are good business people, and if they see that they are going to lose with the fixed rate, they are going to increase the cost of this type of mortgage so that people don’t change, or if they change, they stay the same or more. to deserve”.
After all, changing your mortgage “has some costs”: “on the one hand, there is the difference in the interest, and on the other, the commissions that the bank may charge us, among other services that they could add to the exchange, such as taking out insurance with them”. There is more: “sometimes there are also registration fees, notary fees … and in some cases even a new appraisal of the property.”
For this reason, Alabort urges “taking this expenditure into account, calculating how much we’re getting, and making an assessment.”
In the case of wanting to switch, he summarizes that there are three ways: “signing a new mortgage, that is the most expensive and complicated option; switching with your own bank or subrogating with another entity”.
according to the latter EITB dataIn the first quarter of this year, the number of mortgages with a fixed interest rate is almost the same as that with a variable interest rate. However, with the Euribor in full “sprint”, financial institutions stop encouraging and even offering fixed mortgages that have exceeded 3.6% APR in some cases.
The Association of Financial Users Asufin has put figures: the rise in interest rates translates into cost increases of about 1,000 euros per year if a standard loan of 100,000 euros is taken as a reference, with a repayment term of 25 years and with an Euribor of 2% plus the difference charged by each entity to each customer.
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Source: EITB
I’m Wayne Wickman, a professional journalist and author for Today Times Live. My specialty is covering global news and current events, offering readers a unique perspective on the world’s most pressing issues. I’m passionate about storytelling and helping people stay informed on the goings-on of our planet.
