I'm afraid this is the way it works. You will be stuck with this rate for a whole year. You have two options:
Marta (our mortgage expert) may be able to offer further advice.
- Talk to your bank and ask for your mortgage to be revised every 3 months (probaby useless, as banks are seldom helpful)
- Take your mortgage somewhere else (provided you find a bank willing to offer you better conditions, which might be not that easy at the moment). Not only you will be reducing your 1.25% margin rate, but also the Euribor will be that of the month the binding offer is issued. This has a cost of 0.5% subrogation fee, plus around an extra 0.5% for notary an registry fees, and lawyers fees of 0.5% (in total 1.5%). At the current rates, you would be paying around 3% less on the principal on your first year (1.5% after costs). On a mortgage of, say, €300,000, the savings would be of €4,500. The worst that can happen is that, upon receiving the binding offer, your current bank matches it to prevent you (by law) from leaving.
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