The Euribor has already started the change in trend and paying less for your mortgage each month is over, it is not expected to be a rapid rise but it will be constant. Each year you will pay more and so it will be for many years. It should not be something that worries you in the short term but in the long term you have to take it into account. Can you afford it?
If you are worried about this rise in the Euribor, you have time to make a decision that you probably won’t be able to make in a few months, change your variable mortgage-
A variable mortgage is a mortgage whose interest rate is not fixed and is referenced to a(…)-” href=”https://www.euribor.com.es/glosario/hipoteca-variable/” data-gt-translate-attributes=”[{“attribute”:”data-cmtooltip”, “format”:”html”}]”>variable mortgage for a fixed one. A movement that more and more mortgagees are making. A mortgage is not for life, it can be changed at any time.
How does a fixed mortgage become a variable?
There are three ways to convert a variable mortgage into a fixed one: with a Novation-
The mortgage novation consists of renegotiating the conditions of the mortgage with the same(…)-” href=”https://www.euribor.com.es/glosario/novacion/” data-gt-translate-attributes=”[{“attribute”:”data-cmtooltip”, “format”:”html”}]”>novation (change the type of mortgage in the same bank), with a surrogacy-
Subrogation is the process of transferring your mortgage to another bank, generally with better(…)-” href=”https://www.euribor.com.es/glosario/subrogacion/” data-gt-translate-attributes=”[{“attribute”:”data-cmtooltip”, “format”:”html”}]”>Subrogation of Creditor-
In a mortgage loan, the creditor is the figure that lends the money and therefore has(…)-” href=”https://www.euribor.com.es/glosario/acreedor/” data-gt-translate-attributes=”[{“attribute”:”data-cmtooltip”, “format”:”html”}]”>creditor (transfer the mortgage from one bank to another and change the conditions) and with contracting a new mortgage (ask for a fixed mortgage-
The current mortgage offer could be divided into three types, fixed, variable and mixed, being(…)-” href=”https://www.euribor.com.es/glosario/hipoteca-fija/” data-gt-translate-attributes=”[{“attribute”:”data-cmtooltip”, “format”:”html”}]”> new fixed mortgage and cancel the variable)
The three options-
Options are contracts on stocks, indices, currencies, commodities or investment instruments(…)-” href=”https://www.euribor.com.es/glosario/opciones/” data-gt-translate-attributes=”[{“attribute”:”data-cmtooltip”, “format”:”html”}]”>options have their costs in commissions (up to 0.15% of the pending amount if the modification is carried out during the first three years of the life of the mortgage) which in the case of a new mortgage can skyrocket ( and probably not worth it).
To find out if it pays to make the change, the best thing to do is use a calculator and do the numbers, since they will be different for each client, depending on the current conditions of their mortgage and the years they have been paid.
If the numbers work out for you or you simply want to forget about the Euribor scares, it is best to do it as soon as possible since fixed mortgages are currently very cheap but they are becoming more expensive and will probably become more expensive in the coming months.
