As of the end of April 2012, the mortgage rates applicable to variable rate mortgage loans changed significantly. New indices appeared, such as the IRS ( Interest Rate Swap ) or exchange of interest rates at 5 years and others disappeared, such as the IRPH of banks and that of savings banks (only the IRPH of all entities is in force ).
In 2018, we can affirm that the IRS has not been used as a mortgage reference in any mortgage loan signed in Spain and that the IRPH as a whole of entities has been more than questioned as a transparent mortgage index.
Those mortgaged who had mortgage indexes that disappeared
- Look in the mortgage loan deed which substitute index corresponded to them. Sometimes it was the euribor; However, sometimes the writing did not say anything and the IRPH of entities had to be applied plus a certain referential, with the problems that entailed.
- Negotiate calmly with your financial institution the new index that will be applied, since for a year the old one is still valid.
The mortgage rates currently applicable
- Average type of mortgage loans for more than three years, for the acquisition of free housing, granted by credit institutions in Spain ( IRPH ).
- Average type of mortgage loans between one and five years, for the acquisition of free housing, granted by credit institutions in the euro zone.
- Type of internal yield in the secondary market of the public debt of term between two and six years.
- One-year Euribor .
- Exchange of interest rate or Interest Rate Swap ( IRS ) to five years.
- The Mibor is still valid for mortgages contracted before January 2000.
It is very important that the client does not pay attention only to the monthly installment of the first year when selecting a mortgage. Variable rate mortgage payments change in each review period. Therefore, it is vital to know the type of reference and the applicable differential. A euribor +1 or an IRPH +1, for example, are not comparable. You have to see the graph of the evolution of the reference indices before making a decision.
It is essential that we consult with independent experts, since the bank looks for its interests, not those of the client.