January 2006

You're watching the articles of Euribor for the month of January 2006.

The EDF rises in U.S. rates to 4.5%

The Federal Reserve has decided to raise the benchmark interest rate by a quarter-point, to stand at 4.50% The last hike occurred on December 13 where he went from 4 to 4.25%. This is the fourteenth consecutive time that the authority Monteria revises upward the price of money.

See also Euribor February

Written by Carlos Lopez on Jan. 31, 2006 0 comments
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The Euribor rose to 2833% in January, the highest point in the last 3 years

The indicator most often used to calculate the price of mortgages, the Euribor, fell in January at the highest point of the last three years, the 2833 percent, after climbing more than half a point in the last twelve months ...

Written by January 31, 2006 with 3 comments
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The mortgages can vary by up to 440 euros a year depending on the chosen bank

When it comes to choosing a mortgage, should be borne in mind the unforgettable slogan that TV commercial enlightening: 'Look, compare and if you find something better ...' The recipe for anyone. Depending on the financial institution you choose, you can save up to a Cordoba 441.96 euros in annual mortgage if the bid is taken as reference the average amount of loans issued last October, which stood at 84,233 euros for a repayment period 25 years with variable interest.

The findings are drawn from a study conducted by the Federation of Consumers in Action (Facua) compared to 27 mortgage products offered by 16 financial institutions. Seven of them are banks' online ', which, indeed, pose the most advantageous terms, while the remaining nine are traditional institutions.

The lowest offers in Cordoba, for the above amount, amounts to 405.08 euros monthly fee, while the worst is raised to 441.91 euros, according to the analysis of Facua. The organization recommends that consumers compare each bid in the annual percentage rate, an indicator that takes into account all the economic variables of the transaction: interest, initial commissions, frequency and duration of payments on the loan.

In the best offer mortgage of Cordoba in the TAE found was 3.1653 percent (interest of 2.99% in the first year and the remainder to the Euribor plus a spread of 0.35% excluding fees). The worst has an APR of 4.1577% (initial interest of 3.25%, followed by the Euribor plus 1.25% and a commission of opening similar).

Source: ABC cordoba

Written by Carlos Lopez on Jan. 31, 2006 0 comments
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The Euribor returns to make mortgages to climb in January to 2.83%

Source: http://www.invertia.com/noticias/noticia.asp?idNoticia=1454176
The Euribor, the principal benchmark for mortgages in Spain, held in January, the rate started rising in late 2005 and stood at 2.83%, in the absence of the last crossing of morning-versus 2.78 % With the ending financial year. This new development is keeping the maximum Euribor in more than three years. The experts reaffirmed its estimate for this indicator will rebounding to around 3.5% in 2006.

The increase will bring a new cost of mortgages. Thus, for the previous month, increasing the share paid at a rate of 120,000 euros loan with a repayment to 20 years amounts to three euros a month, from 652.3 euros to 655.3 euros. By contrast, taking into account periods of more usual review of the mortgage, and the half year, the increase in price is 38 euros a month (since closed in July 2168 to%) and 30 euros (in January 2005 ended at 2312%), respectively. According Ignacio Ortiz, Euromoney, the Euribor to 12 months will continue to "rationing increases progressively to close at around 3.5%, reflecting increases in rates in Europe planned for this year, putting up the price of money in the 3%. In view of this expert, the members of the European bank had already made several warnings about his concern about inflation, "which means they probably are preparing the market for a forthcoming increase in the price of money in March, followed the other possibly in the summer, to 2.75% and one at the end of last year. "

In the opinion of Stephanie Ponte, Beta Capital (Fortis Group), it is clear that the rates have to continue to rise, "because they have to be adapted to the increases that are set by the ECB and the expectations of 2007, thus reaffirm our Calculations of December, according to which as of this summer, mortgage rates could average as 3.5%. "

During the month of January, the index has followed a clear upward trend. The first day of the year this indicator marked the 2.85%, to subsequently declined until mid-month and return to rebound from that moment. The last change in today set at 2.89%. (More ...)

Written by Carlos Lopez on Jan. 30, 2006 with 1 comment
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Forecasts Euribor: Interest rates could rise in March to 2.5%

Source: http://www.elmundo.es/suplementos/s ... 1138316408.html

You could say that Jean-Claude Trichet, president of the European Central Bank (ECB), holds the economic destiny of home buyers mortgaged. The final annoyance for consumers, the pick-up quarter-point interest rate up to 2.25%, may involve the start of an upward climb, which will last until the end of the year. At least that's what the experts think.

The situation does presage further increases in rates because the ECB has repeatedly expressed the need to control inflation too high by continuing rises in oil prices. Analysts are studying very closely these days Between the messages of the highest financial authority in the euro zone to advance the exact date of the next rise and the interest rate to dismiss to 2006.

Effects

Euribor one year is the index most commonly used in the Spanish mortgage market to reference the loans. But there is a direct relationship between Euribor and interest rates. Euribor one year is the forecast made by banks in Europe of what it will cost money to a year away. If interest rates continue to rise and expected the same trend, the variable mortgage will continue ticking and maximum monthly premiums for mortgage buyers will continue to rise.

The ECB's chief economist, Otmar Issing, warned last Tuesday that the entity will act if necessary to raise rates, as it did last Dec. 1. These statements reaffirm the view of analysts who believe that the next increase will take place in March, when the entity publishes its quarterly forecasts, which could reveal a better performance of the economies in the euro zone.

Phased rebound

"It's hard to know when will occur the next rise. The latter is very recent and usually take several quarters to begin to be felt the effects on the economy. It is understood that at year-end rates could be closer to 3%, but in a very staggered. The ECB will have to be very cautious not to cause an abrupt adjustment in the housing market and stock markets, "Gregory believes Izquierdo, director of Analysis of the Institute of Economic Studies (IEE).

For Paul Guijarro, International Financial Analyst (AFI), the forecasts are "a climb up to 2.75% by the end of the year." In his view, "though the business is recovering, consumption is weak," something that does not suggest significant increases in interest rates.

"We see that in 2006 the rates go up twice, once in March and another probably in September. If the oil fires could close the year at 3%, to contain inflation but does not expect aggressive price increases, up 3.5%, "Guijarro said.

American Express, in a study on the current market situation, also bet on a rise in rates of 0.75 basis point throughout the year, although the firm believes that oil prices will stabilize and will not be required for increases above the barrier of 3%.

Mortgage rate

Despite the bad omens for interest rates, experts believe that increasing the cost of money will have a limited effect on the loans made by the buyers, because the Euribor takes several months to grow to anticipate the predictions to a year away. Since the first ascent, last October, the mortgage rate has continued to record peaks, rising from 2.22% in September to 2.78% marked in December.

The values that are experiencing this month Euribor in January suggest a further increase. The latest available data, the average daily trading of the second decade of January, placed in the variable 2.82%, thus creating a new cost of mortgage loans. In the past few days has been moving even above 2.85%. However, we will have to wait until late January to hear the final figure.

Experts believe that rises as rates of Euribor will be acceptable to the vast majority of buyers, although a price increase of money in excess of 3% could tighten the rope too.

* Impact of the rise in the Euribor in a mortgage

RISING DEBT OF FAMILIES

The indebtedness of the Spanish families reached 674,410 million euros in the third quarter of the year, an increase of 18.5% over the same period last year, according to data from the Bank of Spain. The interpretation of the figures published by the agency showed that mortgage loans remain the major engine of the debt. At the same time, more than 90% of these loans (data from the National Institute of Statistics) are variable interest, vulnerable to changes in the price of money. The debt of the families thus reaches a new historical record and already amounts to 76% of GDP.

Considering the large volume of debt, have started to hear voices warning. The General Association of Consumers (Asgeco) has denounced the excessive indebtedness of households and has asked the Government a 'law of bankruptcy family' to address this situation.

The Socialist parliamentary group in the Congress of Deputies has already raised a few weeks ago the necessity of adopting an "Act of overhang", but without clarifying what steps might contain.

Written by Carlos Lopez on Jan. 27, 2006 with 18 comments
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