Although their presence has lost weight, the commissions can make the amount that ends up being paid on a mortgage more expensive. Some appear from the moment the loan is requested, and others accompany the mortgaged until its completion. The good news is that if you have a good financial profile and follow a series of tips, you can negotiate them to get a more beneficial loan.
With the Mortgage Law approved in 2019Some of the usual mortgage commissions disappear, and others are modified. In addition, strong competition between banks is leading to increasingly competitive loans, in which in many cases many of the fees are waived.
Types of mortgage loan commissions
These are the commissions that may appear, as of today, on a mortgage:
1.Opening committee
Many banks currently dispense with this commission, which when it exists is calculated as a percentage of the capital financed and which is paid when the loan is formalized. The last mortgage law eliminated the study commission, previously usual, but which in many cases is included implicitly within the expenses of incorporation.
2. Surrogacy commission
It is the commission charged by the bank when the debtor of the mortgage (the owner) or the creditor (the bank) are modified. More and more entities do not apply a subrogation commission either, which can be a maximum of 0.5% of the outstanding capital during the first five years of the loan, and 0.25% in the following years.
3. Commission for withdrawal
Some banks apply this commission when a loan is canceled or amortized, in whole or in part, before the due date. In variable mortgages signed before 2007 the commission can be up to 1% of the amortized capital. For those after 2007, both fixed and variable, the maximum commission is 0.5% of the amortized amount if the amortization occurs during the first five years of the loan, and 0.25% after the first five years.
4. Compensation commission for interest rate risk
It is included in the increasingly common fixed rate mortgages. It is applied in the event that a total or partial amortization entails economic damage for the bank. These compensations can be a maximum according to the legislation of 0.50% during the first five years of the loan and 0.25% during the rest of the mortgage.
How to negotiate the commissions of a mortgage
Certainly, if before the commissions were a significant expense during the life of a mortgage, today the offer is so wide and the competition between entities so great that you can effortlessly find loans without commissions, or hardly without them. In any case, it is advisable to compare the largest number of mortgages possible, and carry out a detailed analysis of the costs of each of them, also taking into account other factors such as the interest rate or related products.
Any of these issues, including commissions, is negotiable; especially if you have a good financial profile. For that reason, negotiating the commissions of a mortgage is an asset that should not be dispensed with. For this, it is advisable to go to the meeting with the bank with all the documentation that justifies the good economic and employment situation. Aspects such as available savings, a permanent contract with a good payroll, or no other loans are good arguments when negotiating the conditions of the mortgage.
Before the negotiation it is advisable to set some objectives. What is the maximum that you are willing to pay for each commission? What if what the entity offers is an improvement in other conditions of the mortgage? Having these clear ideas will make it easier to negotiate and reach a good agreement.
On the other hand, it must be taken into account that there are other types of commissions that can also take a toll: those of the linked products that the entity offers to contract with the counterpart of improving the loan conditions. Most of these linked products – life or home insurance, cards, pension plans … -, in addition to a cost, usually have commissions attached; from the maintenance of the bank account or credit cards to the management expenses of pension plans.
It is very important to have all this information when the different mortgages are analyzed and compared, and also before negotiating with the bank, since the money that can be saved with low interest or the absence of commissions may not compensate the cost that year after year they are going to pay for these products, usually cheaper if they are contracted outside the bank.
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