2023-07-06 08:09:57
“And it will continue to rise,” says the director of the banking business at Housfy Hipotecas, David Espiago, when asked about the future of the Euribor, the reference index for variable mortgages. “Not with excessive aggressiveness,” he qualifies.
Espiago admits that the majority of mortgage holders who use the services of the mortgage brokers of his team is opting to cancel his current mortgage and open a new one with another entity, an option that he recommends as being more effective than renegotiating the conditions with the current bank.
mortgage broker
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And it is that, according to the mortgage specialist, this option allows change from variable mortgage to fixedbut also extending the debt or extending the term of the loan, two of the most effective ways to alleviate the growing mortgage burden on households.
IMPROVE YOUR MORTGAGE AND SAVE ON YOUR FEES
I have a variable mortgage. How much can it go up in 2023?
With the latest data from June 2023, when the 12-month Euribor registered a value of 4.007%, let’s see how much the monthly installments of various variable mortgages would increase depending on the amount of capital financed.
For the calculations, we use specialized tools of mortgage simulation of the comprehensive home platform Housfy.
The assumptions simulate loans of varied capital at 24 years (average term of mortgages in Spain according to the INE) and at 80% financing, and compare the resulting installments by applying the Euribor of June 2022 (0.852%) and the Euribor June 2023 (4.007%), plus a hypothetical spread of 1%. The data is indicative.
Variable mortgage of €90,000
CHANGE YOUR MORTGAGE FROM VARIABLE TO FIXED
Variable mortgage of €140,000
CHANGE YOUR MORTGAGE FROM VARIABLE TO FIXED
Variable mortgage of €250,000
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Variable mortgage of €450,000
Variable mortgage of €600,000
Variable mortgage of €800,000
How to improve a variable mortgage before a rise in interest rates?
There are several options that a user has to alleviate the mortgage burden of his variable rate loan. Choosing one or the other will depend on your situation and your priorities as a mortgagee.
Negotiating new conditions with the bank —what is known as a mortgage novation— is one possibility, although in practice it is common for the bank to be more willing to negotiate with new clients than with current ones.
For people in a particularly vulnerable situation, the banks make available the Code of Good Practices with which the debt can be restructured without changing the entity, with advantages such as interest rate reductions or a grace period. The requirements to join, yes, are strict.
The most convenient options, as pointed out by the experts consulted, are the mortgage subrogation —bring your mortgage to another bank willing to improve it— or, directly, open a new mortgage and cancel debt with the previous bank.
IMPROVE YOUR MORTGAGE WITH THE HELP OF A BROKER
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