The Euribor seems to have peaked. With the rates of the European Central Bank frozen after the October meeting, this mortgage index has stagnated at values close to 4%. And there are many who wonder if now could be a good time to take out a variable mortgage, the price of which could be affordable if the Euribor changes trend and returns to near its historical average (around 2%).
But is it really worth getting a variable rate mortgage? Or is it better to opt for the security of a fixed interest rate? According to the financial comparator HelpMyCash.com, the customer who wonders if Is a fixed or variable mortgage better? You must calculate how much you would pay in fees with both modalities and assess, with the data in hand, which of these two options best suits your risk tolerance.
Calculate the fixed mortgage payment
For example, let’s say that a client wants to take out his mortgage loan with BBVA. The Fixed Mortgage of the Basque entity has an interest from 2.90% for a term of up to 15 years or from 3% if it is returned in between 16 and 30 years, which can be obtained in exchange for domiciliating the payroll or pension and hiring home insurance and amortization insurance with the bank.
If this person needs an average amount of 150,000 euros to be repaid in up to 30 years and meets the bonus requirements proposed by BBVA, their interest will be 3%. Consequently, he will pay fees of 632.41 euros per month. Since its type will be fixed, The amount of your monthly payments will never changewhatever happens with the Euribor.