Variable mortgages remain the cheapest option in the market and, in addition, they live in one of their best moments, in part, thanks to the negative Euribor values.
However, this situation does not benefit the banks in any way, since they could reach the stage in which they had to pay their clients for the mortgage. Despite this, a study by the Good Finance mortgage comparator warns that 63% of new mortgages will not be able to benefit from negative Euribor rates.
Why this reality?
If all the mortgages currently offered are analyzed, only 37% will be used to take advantage of the historical minimum of the Euribor during the first months of mortgage. This situation is due to the fact that many of the mortgages that apply low interest, less than Euribor + 1.25%, apply during the first months a TINI (Initial Nominal Interest Rate), which is at a fixed rate. In this way, in the first months a fixed interest is returned to the bank and not the variable that was initially expected.
This is the way many banks have to shield themselves against the current Euribor in negative, ensuring stable income. However, that the mortgage has TINI is not beneficial for the mortgaged , since, currently, one of the main advantages of variable mortgages is to be able to take advantage of minimum interest rates. To understand it with an example, with the ING Direct Orange Mortgage at Euribor + 0.99% , monthly payments of 480 euros would be returned to the bank during the first year. On the other hand, with the Liberbank Now Mortgage, which has the same interest but during the first year a TINI of 1.95% applies, the first year fee would be 550 euros (taking into account a mortgage of 150,000 euros at 30 years and the Euribor of March at -0.012%).
For this reason, from the Good Finance comparator, they advise that if a variable mortgage is to be contracted in order to take advantage of the Euribor minimums, paying during the first months a really low fee, you must avoid the mortgages that are included within that 63%
Are fixed and mixed mortgages a new alternative?
Recently, many entities have started promoting fixed and mixed mortgages so that the negative Euribor does not affect its balance sheet.
Despite this, are they a real alternative to saving variable mortgages? From the comparator they say no. On the one hand, mixed-rate mortgages apply a fixed interest during the first years, which are usually up to ten, which makes it impossible for the Euribor minimums to be taken advantage of when the variable interest is applied, because it will surely have returned to go up.
On the other hand, with fixed-interest mortgages, the Euribor may not be used negatively, although they are a different option than the variables. Recently, many entities have begun to market offer never seen, with interests less than 2%.
Being mortgages that do not depend on any benchmark, the monthly payments are exactly the same, so they can be shielded from a possible rise in the Euribor. However, they are loans for a specific financial profile: by having shorter repayment terms, monthly installments are higher, so they can only be allowed by people with high incomes.