this the sharp rise euribor In the last months, whose daily values reached even 0.5% in this first week of June 2022, more citizens who have mortgage decide to change the bank at a variable rate This will fix your interest rate.
The question is: what more compensates, cancels or succeeds the mortgage? On the one hand, to make a recourse by the creditor, Doesn’t have to start from scratch with a mortgage loanIn other words, there will be no need to pay the initial opening fee or interest as in the cancellation. Also, since the Mortgage Law reform in 2019, it is the new agency that bears most of the costs. Customer I would only have to pay the costs of the assessment housing (approximately 425 Euros), if required, notary deed copy (250 Euros) and surrogacy feeVaries depending on legislation:
· If you change the terms of the variable mortgage by recourse to another mortgage within the first three years, the commission will be up to 0.25%, if you do it within the first five years, it will be 0.15%.
If the terms of the fixed mortgage are changed to another mortgage, the succession commission can be up to 2% in the first ten years and up to 1.5% in the next ten years.
In case of cancellation, you will need to add it. cancellation cost of previous mortgage (400 Euro) for the above-mentioned appraisal and notary copy costs. Similarly, instead of paying a commission for succession, the encumbrance must pay the Documented Legal Transactions Tax (IAJD) established by each autonomous community and an early depreciation commission that can reach 2% (as in rank). amortized amount if the initial mortgage is subject to a fixed rate, or 0.25% if the interest rate is variable. This is where the process can get more expensive.
Banks prefer to cancel
Simone Colombelli, director of Mortgages at iAhorro, explains that there are more cancellations than recourse in Spain because “the bank doesn’t want to recourse in this way (despite the fact that many requests are registered to change from variable to fixed) but in many cases, financial institutions try to cancel the existing mortgage so that the user has to take the mortgage again from another bank” and the image of the property in question was not harmed.
In this sense, the director of iAhorro Mortgages, handicap faced by those seeking succession In cases where the economic difference of cancellation is too high for the consumer, it is the preference of financial institutions to cancel and create a new mortgage instead of succession. Even with the same commissions, the costs increase.”
2,000 Euros less for surrogacy
When calculating the total, the succession Up to 2,000 Euros cheaper. For example, when canceling a variable mortgage of 142,965 euros (currently the average of Mortgages issued by the National Institute of Statistics for this 2022), we pay 2,862 euros, including appraisal costs and the IAJD, while substituting for another. The variant with the better conditions will cost 1,032 euros, with the costs and commissions required by the process, ie 1,830 euros less. In both cases, maximum commission according to the legislation.
In case we want to use the same variable mortgage of 142,965 Euros for a fixed mortgage, the maximum commission charged by the bank will be 0.15% of the remaining amount in the first three years of the loan’s life and, according to the 2019 Mortgage Law reform, if the mortgage was signed more than three years ago will not be accepted. Why is this? Colombelli, “It’s much easier and cheaper to switch from a variable rate mortgage to a fixed rate mortgage because the law encourages this change to seek greater security for the user”. So much so that in this case succession would cost 889 euros, and cancellation would cost 2,862 euros, or 1,906 euros.