Following the meeting of the European Central Bank held on 4 June, the Governing Council chaired by Christine Lagarde has decided to keep interest rates at minimum levels, with the REFI (Refinancing, more commonly known as the ECB rate) at 0.00%.
Who has a mortgage a variable rate or intends to sign one, therefore, can breathe a sigh of relief. In fact, the benchmark of variable mortgages, Euribor, directly follows the monetary policies of the ECB, and in particular the REFI rate is reflected in the trend of interbank indices, just like the Euribor rate.
Just today, after the decisions taken by the European Central Bank to keep rates steady, theEuribor at 3 months fell to -0.35, at least since March.
On the contrary, the reference index of fixed rate mortgages, the Eurirs, according to the latest surveys, rose as it had not happened for a couple of months, bringing the maturity to 20 and 25 years to 0.24 and the 30-year maturity a 0.21, the latter in 20 basis points increase in the past 10 days.
Despite slight increases, the good news for those who intend to take out a fixed rate mortgage, as well as a variable rate one, is that the banks are maintaining at this stage the spread value, or the earnings of the lender, at very favorable levels for the borrower.
Today it is possible to obtain a ten-year variable mortgage starting from 0.20%, and from 0.50% for a mortgage a fixed rate in 15 years.
The best fixed rate mortgages
Who buys a house with a mortgage and wants to block the installment for the duration of the loan can apply for a fixed mortgage very advantageous conditions.
On a constant rate mortgage loan for amounts up to 50% of the TV, or the percentage of intervention between the required capital and the value of the property, Intesa Sanpaolo grants a finite rate of 0.50% for a duration of up to 15 years and a rate of 0.55% for durations up to 20 years.
Among the banks offering i best fixed rate mortgages of June we also find Credem Banca (Tan 0.55%), Monte dei Paschi di Siena (Tan 0.64%) and a number of institutions, including Crédit Agricole, Ubi Banca, Hello Bank! is BNL, who apply a fixed rate of 0.65% to their new customers for durations of up to 20 years.
For longer mortgage durations, MPS proposes a rate of 0.74% for LTV up to 50% and 0.99% for LTV up to 80% compared to the value of the property to be mortgaged.
Among the best offers this month we also mention Intesa Sanpaolo, which applies a rate of 0.75% for mortgages with LTV lower than 50%, and Hello Bank!, which together with We Bank offer a rate of 1.15% and 1.19% respectively for LTV up to 80%.
The best variable rate mortgages
Among the best mortgages that follow the trend ofEuribor index, today we find Credem Banca, which offers a rate of 0.39% for a home purchase mortgage with a duration of 20 years.
Unicredit apply a Tan of 0.44% e Intesa Sanpaolo offers its customers, as well as new account holders, a variable rate of 0.45%. Following, among the most convenient mortgages indexed to the Euribor index, we highlight MPS is Crédit Agricole, with rates around 0.50% for LTV lower than 50%, and around 0.70% for mortgage amounts up to 80% of the property price.
As for the variable mortgages of duration thirty years, particularly suitable for young people who need to save on the loan installment by extending the payment term as much as possible, the best rates offered by banks rise between 0.05 is 0.10 percentage points, always keeping a excellent rate level for those who want to buy a property.
Just think that for a mortgage of 100,000 euros with duration of 30 years, with a rate of 0.70%, you would pay a monthly installment of 308.05 euros, for a total repayment of interest equal to 10,898 spread over all the amortization, i.e. just over 350 euros per year of interest expense. Less than a monthly rental of a studio apartment.
Mortgage subrogation: the best offers of June 2020
Who wants replace the old mortgage with a more advantageous one, you can ask a lending institution for it better conditions to substitute the previous mortgage. The convenience of the subrogation lies in the fact that the new bank takes on the costs related to the transfer operation, including thehonorary fees, the Bank charges and the expertise.
Those who meet the requirements to apply for a mortgage subrogation, would do well to evaluate the transfer of the debt to another bank as soon as possible so that they can take advantage of the very interesting conditions which currently offers the banking market.
Eg, if the current residual mortgage debt was equal to 130,000 euros and they still had to pay 20 years of amortization, those who choose a fixed rate surrogate today could get a Tan of the 0.70%, keeping the original deadline.
If we calculate that who has taken out their mortgage more than five years ago at a rate of 3% or higher, opting for the subrogation, today it would save an amount equal to 140 euros per month, which for the entire amortization period correspond to approximately 33,000 euros.
To find out how much is possible save on the installment of your mortgage, just ask for a quote without obligation and rely on an expert in the sector. The time may have come to change the old mortgage.
The best subrogations of June start at a variable rate of 0.44% and from 0.55% for a fixed rate with a duration of 20 years.
Continuing the simulation of twenty-year mortgage, among the best variable rate subrogations we find the offers of Unicredit (Tan 0.44%), Intesa Sanpaolo (Tan 0.45%), Credem Banca (Tan 0.49%) e MPS (Tan 0.50%).
Mortgages fixed rate substitute cheaper at the moment are proposed by IW Bank, which offers a finite rate of 0.55%, from MPS, with a Tan of 0.65% and to follow from Intesa Sanpaolo is Unicredit, which respectively offer a rate of 0.70% and 0.75%.
100% mortgage, obtain financing of the entire house price
As a rule, banks grant a mortgage of maximum amount of 80% compared to the price of the property. However, you can access the First Home Mortgage Guarantee Fund, managed by Consap, which mainly helps the young couples or who has a fixed-term contract to obtain a mortgage up to 100% of the value of the property you intend to purchase.
Among the banks that grant a mortgage higher than 80%, not necessarily using the Consap Fund, we find Intesa Sanpaolo, which finances up to 95% of the price of the property to be mortgaged at a rate of 1.75% for a period of 20 years and BNL, if the value of the appraisal respects the terms of 80% of the value of the property.
Subrogate more liquidity
Those who already have a mortgage in progress and need to ask for a greater amount when replacing the old loan, can get one subrogates more liquidity or a debt consolidation mortgage.
Both solutions are suitable for those who have other outstanding loans and want to have asingle installment with a single credit institution or intends to allocate additional liquidity for gods renovations or again, for example, buy a garage near home.
Among the banks that grant the surrogacy more liquidity we mention BNL, which for an duration of the twenty-year contract, applies an interesting fixed rate of 1.10%.
As regards debt consolidation, it should be noted What a bank!, which offers a mortgage loan up to 70% of the property’s value at a rate starting from 2%.
Beware of the Taeg: the mortgage choice must be based on a series of information, including the Tan, which represents the rate at which the loan installment is calculated, but also the Taeg, which is the rate that indicates the real cost of the loan. In fact the Taeg takes into account all additional costs of the mortgage, from the charges for taking out the loan at the periodic costs indicated in the contract.
The choice between fixed rate and variable rate mortgages
Another important aspect to consider before taking out a mortgage is the rate choice, between fixed and variable.
It is important to monitor the performance of the reference parameters of fixed and variable rate mortgages, respectively theEurirs and theeuribor. In this historical period in which the difference between the two indices is minimal, the choice of the majority of families who apply for a mortgage today is falling on the fixed rate, which guarantees the same installment for all the amortization.
How to choose the ideal mortgage
As said, it is important to dwell on the choice of the rate, just as it is essential to request various mortgage estimates in order to make a comparison between multiple banks, carefully evaluating the Taeg.
To get a more complete overview of the best mortgages and subrogations out there, it can be useful to consult a credit broker can recommend the right bank and the most suitable solution to every need.