Euribor rate is dropping fast which translates into lower monthly mortgage repayments
The Euribor rate is the reference which most Spanish Lenders take to set the mortgage rate of interest. This rate is revisable depending on your Mortgage Deed every six months or once a year.
Due to the recent Monetary Policy followed by the by the European Central Bank (ECB) to drop interest rates this is indirectly affecting the Euribor rate.
The Euribor rate is the rate of interest at which banks lend to each other. It is not governed by the ECB but on lowering the official rates of interest it does affect it in due time.
In any case the continued policy of the European Central Bank to lower the interest rates over the last months will help to drive down the Euribor rate which is always news welcomed by everyone. Spanish banks will revise the Euribor rate and this in turn will lower your monthly mortgage repayments.
So for all those that are struggling to pay their mortgage loan and are considering defaulting you should be aware of this significant drop in 2009. I suggest you find out at your bank when the Euribor rate will be adjusted for your own particular case.
More on this subject.
http://www.cotizalia.com/cache/2009/...a_mensual.html
Is the rate fixed for a whole year?
Quote:
Originally Posted by
Marta
Hi!
You need to check with your bank whether your mortgage is revised once or twice per year, as well as finding out which month's Euribor average rate they will take into account when calculating your monthly repayment. Although the Euribor rate has dropped very fast, if you happened to sign your mortgage deed in December then the bank will have taken the previous month's Euribor average rate ( November) or even the one before that ( October). For example, I signed my mortgage on the 5th of December two years ago. For my annual mortgage revision, as I signed before the 15th of December, the bank have taken October's Euribor average (5.25%) instead of Novembers ( 4.35%). So sadly instead of finding that my mortgage repayment has dropped.. it has raised by 105 EUR!!! :eek:
My mortgage went up after a year's fixed rate to 1.25% above the eurobor. When it went up it went up to 6.25%!! UGGHH!! Are you saying that I'm fixed with that rate for a whole year? The eurobor is really low now and it seems wrong that I'm paying SO much interest.