Fixed share, or a delusion.

Is there a formula to pay less miraculous, if the Euribor rises?

That is what we will try to show the banks and also the media, but if rates go up, borrowing also, look what we look like.

What options are there in times of rate hikes?

Fixed rate (the usual, the Europeans)

The fixed-rate mortgages allow always pay the same monthly fee for the life of the loan. Never will affect the possible variations of the interest rate because of changes in the market. The drawback is that, in general, the time of life that can be set in such claims usually do not exceed 30 years and that initial interest rates are higher. Front, for example, a 4.25% variable to 30 years, another 5.5% fixed.

Fixed Fee (danger!)

In the fixed amount of mortgages, the individual pays the same fee, without worrying about future rate hikes and, in general, however, taking advantage of the downhills. The variations in interest rates affect the time and not in the quota , So in the case of a decrease in the rate reduces the time, while rising, the number of shares to pay, not its amount.

More information: http://www.elpais.es/articulo/dinero/busca/tranquilidad/hipotecaria/elpnegdin/20060806elpnegdin_1/Tes/

Written by Carlos Lopez on August 8, 2006 with 6 comments
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