The Congress of Deputies debated this week a proposal by United We Can to make the Changing a Variable Mortgage to a Fixed Mortgage. The initiative, which probably will not pass the filter of the Cortes, was intended to help those mortgaged at a variable rate who do not want their installment to skyrocket due to the rise in the Euribor and are considering modifying their contract to pay a stable monthly payment.
This, according to HelpMyCash, saves money for the mortgaged person. In the event of switching to the fixed rate through novation or subrogation, the maximum commission that the bank would charge if this measure did not exist would be up to 0.05% of the amount pending repayment (this limit was up to 0.15 % before the promulgation of the decree), applicable only if the operation is carried out during the first three years of the life of the credit. And if the client contracts a new mortgage loan to settle the current one, the compensation for amortizing his variable mortgage could reach 1%.
Yes, you have to pay other expenses
The operation, however, is not entirely free, as United We Can intended. According to the comparator analysts, if a novation is carried out to convert a variable mortgage into a fixed one, the bank can request that the home be appraised to know its value (although it is not obliged to do so). In this case, the client must pay the cost of the appraisal, which is usually around 300 euros on average. The notary, registration and management expenses associated with the novation, on the other hand, must be assumed by the bank by law.
If the change to the fixed rate is made through a subrogation of the mortgage, the bank that assumes the debt will always request that the home be appraised. Consequently, the mortgagee must face the appraisal bill yes or yes; about 300 euros on average. As in the previous case, the notary, registration and management expenses that are generated when subrogating the mortgage loan must be paid by the entity to which the loan is transferred.
Finally, if a new fixed mortgage is contracted to pay off the variable rate one, the client must pay the appraisal of their home (about 300 euros) and the expenses associated with the cancellation of their current loan. According to HelpMyCash, the invoice for these costs can exceed 1,000 euros, although it can be reduced if the operation is processed with an independent agency. With the cancellation fee simulator From this comparator you can calculate how much the budget would amount to.