Loans And Mortgages Information

The decree anti certainly will give a breath of fresh air to a number of families. Who has entered into a variable rate loan will have advantages.

Article 2 of Decree Law 185 passed by the government against the crisis concerning the contribution of the State for 2009 to include the rate of real estate loans at variable rates within and making new loans must have the ECB reference rate.

Taking into account funding by 100 thousand Euros concluded in September 2005 (before the rise in rates) in the 3 months Euribor rate plus a spread of 1, 1% (the average parameters used in the technical report Decree) and applying the ceiling of 4%, the rate of January of a twenty-year loan would amount to 613 Euros compared to 676 Euros paid in November.

It seems however that the decree is not clear in every part. The technicians of the Chamber noted that neither the rule nor the accompanying report will consider the claims in relation to objective reasons under which the intervention of support is gone exclusively for people who have signed a floating rate loan. For this reason the mechanism of protection for variable rate mortgages in the decree law introduced anti could result in “unequal treatment of the legislature in relation to fixed-rate borrowers.”

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The loan is a financing medium and long term granted for the purchase, construction or renovation of a building (usually the main house), or to acquire or restructure the second house.

It is not easy to decide whether to take out a loan at a fixed rate or variable. The fixed rate is a certainty for those not familiar with the markets and fears a rise in interest rates.

For those who do not want the certainty of fixed rate (fixed rate and the expo are not fixed), and want a cheaper rate compared to fixed rate, here is a type of loan that meets these requirements, shifting the effects of possible increases on ‘lengthening of the duration.

Credem bank offers a loan structured with the technical form of the rate, the rate fixed for the entire repayment period and the duration variable, the effect of any changes in the rate may decrease (in case of decrease in the rate) or increase ( if the rate increases). The duration can be increased up to 5 years compared with the initial period.

The choice of the rate is a key factor for the future peace of the borrower, a decision would in fact has an impact on the cost of financing (total interest payable) and the family budget.

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