Banks are no longer interested in their customers getting a fixed-rate mortgage. Now that the Euribor is trading on the rise, what they want is to grant variable mortgages, with which they hope to earn more money in the medium term if the reference index continues to rise. With this goal in mind, numerous entities have decided to raise their fixed interest rates to make them less attractive, while lowering their variable rates.
Leaving aside the purely commercial strategies of the mortgage market, taking out a fixed mortgage is still a good deal for those who want to have their expenses under control and pay stable monthly payments throughout the loan repayment term. According to the financial comparator HelpMyCash.com, there are banks that offer fixed rates of around 1.50% or below, which are lower than those that applied only two or three years ago. With the mortgages that some entities market, therefore, you can pay a fixed fee with an average cost of only 510 euros per month.
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From 510 euros
Openbank’s fixed mortgage is the cheapest on the market
One of these banks is Openbank, which offers the cheapest fixed mortgage on the market, according to HelpMyCash. Its product, called Open Fixed Mortgage, has an interest rate of 1.50% for a maximum term of 30 years, which can be obtained in exchange for direct debiting a minimum income of 900 euros and contracting the home insurance offered by the entity. Both requirements are affordable (direct debiting the income does not cost money) and easy to comply with.
In addition, Openbank lowers its interest by 0.10 percentage points if the client asks for 150,000 euros. For example, if a client requests an average mortgage of 150,000 euros to be repaid over a period of 30 years, this bank will apply an interest of 1.40% and will charge fixed installments of 510.51 euros per month.
From 517 euros
COINC and MyInvestor complete the podium
Another entity that offers very low interest is COINC, an online brand of Bankinter. Your Fixed Mortgage has a rate of 1.50% for a maximum term of 30 years, which can be obtained without the need to contract other bank products. For example, if an amount of 150,000 euros is requested, to be repaid in 30 years, the installments of this loan will be 517.68 euros per month.
Most likely, banks will continue to make their fixed mortgages more expensive to give more prominence to variables
The top 3 of cheapest fixed mortgages is closed by the Fixed Mortgage of the virtual entity MyInvestor (Andbank Spain). As explained by HelpMyCash, this has an interest rate of 1.59% for a maximum term of 30 years, which can also be achieved without having to contract more bank products. The installments of this credit, in case of requesting an average of 150,000 euros to be repaid in 30 years, would be set at 524.18 euros per month.
Euribor
Waiting is not good business
It must be taken into account, yes, that these low interests will not be eternal. As the forecast is for the Euribor to rise, it is most likely that the banks will continue to make their fixed mortgages more expensive to give more prominence to the variables. Consequently, it is advisable to contract the fixed mortgage as soon as possible to increase the chances of obtaining a rate of around 1.50%.
Due to this change in strategy in the sector, it is also possible that the bank ends up offering a higher interest rate than the one advertised. Hiring the services of a mortgage broker can be a good way to minimize that risk: this professional will be in charge of looking for the banks that grant the best fixed mortgages and will negotiate to avoid possible increases in interest during the application process. More information about brokers can be found on the HelpMyCash.com website.
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