2023-05-31 12:11:56
In the absence of data from the last day of the month, the euribor aim to close mayo on a monthly average of about 3,86%its highest level since November 2008 and which implies a rise of 0.1 percentage points compared to April and, what is more relevant, of 3.57 points compared to May of last year. Although the rate of rise of the index to which most of the credits for the purchase of housing in Spain are linked, is slowing downit will still mean a steep rise from mortgage installment for those who have to review the loan rate with the May data.
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Mortgage installments, thus, increase if the Euribor is higher than a year earlier in the month that serves as a reference to review the credit. Its May level implies for a mortgage of 140,000 euros at 25 years and with an interest of Euribor plus 1% to the one that will have to be revised with the new data (normally those that must be updated in July), pay 260 euros more per month (up to 806 euros) and 3,130 euros more per year (up to 9,672 euros). For a loan of 300.000 euros of the same characteristics, the rise would be 559 euros per month and 6,708 euros per yearup to 1,729 and 20,748 euros, respectively.
The Euribor, which theoretically measures the average rate that is banks charge each other for borrowing money, has registered since the beginning of last year a unprecedented rise since its creation in 1999. The index tries to anticipate the movements of the European Central Bank (ECB), which, to combat inflation, has raised the reference rates from 0% to 3.75%, after raising them seven times since july after 11 years without increasing them. The monetary authority has given signs that it will still approve some additional increasebut also that the end of upload cycle is near. The market waits alone two more than 0.25 points percentage in June and July, hence the Euribor is stabilizing, although predictably will exceed 4% in the near future.
rising quotas
Despite this moderation in the rate of increase, the quota increases will continue to be pronounced in the coming months, to foreseeably begin to soften in the second part of the year. This is due to the fact that the review of credits depends on the level of the Euribor with respect to that of the same month of the previous year. Thus, the higher year-on-year differences -greater than three percentage points- began to be noticed last november (the month in which the September Euribor is used as a reference) and will last until the middle of this year, when the index will begin to be compared with the highest levels at the end of last year and therefore the increases in quotas will be smoother .
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“The Euribor curve if it is flatteningeither. The most logical thing would be stabilization that we have seen over the last four months of this reference index of variable mortgages is also maintained during the coming months“, has affirmed the comparator and mortgage adviser iSavings. “Los mortgaged that they have problems to make ends meet they must ask for a date as soon as possible to your banco to study possible solutions. In general, entities are open to restructure the debt of their customers if they ask for help before they default,” has recommended its competitor HelpMyCash.com.
The rise in official and market rates is not only taking its toll on those already mortgaged, but also on those who are signing new loans to buy a house. He average guy of the new mortgages stood in the 3,54% in March, latest data available. This is the most expensive interest since April 2012 and represents a strong rise compared to 1.54% twelve months earlier.
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