The banks are still immersed in the mortgage war, and more and more entities decide to compete in the field of fixed-rate loans for the purchase of a home.
An example of this is Banco Sabadell’s 30-year fixed mortgage, which is one of the most prominent on the market, provided that all the discounts offered by the Catalan bank are applied.
Specifically, if the client is willing to direct debit payroll and take out home insurance, life insurance and payment protection insurance, which covers the payment of the installment in special circumstances such as loss of employment, the interest on this fixed loan is at 1,60% (2,71% TAE). In the absence of bonuses, the interest rate rises one point, to stand at 2.6% (3.25% APR).
In addition to meeting these conditions of directing the payroll and taking out insurance, the Catalan entity establishes other requirements to grant this mortgage: that the monthly payment does not exceed 40% of the client’s total income and that the maximum age of the borrowers at the maturity of the loan does not exceed 75 years.
In general terms, Sabadell offers up to 80% of the home purchase price or appraised value of the property (the lower of both amounts) when the financing is intended for the habitual residence, while in the case of second homes it is willing to cover up to 70%.
Regardless of the bonuses and the home you want to acquire (the usual or a second residence), this fixed loan establishes commissions for early cancellation, either partial or total. If the amortization occurs in the first 10 years of the life of the mortgage, the penalty is 2% on the repaid capital. The amount that the client must pay, of course, cannot exceed the financial loss suffered by the entity due to early cancellation.
If the partial or total reimbursement occurs after those first 10 years, the compensation is reduced by half a point, until it remains at 1.5% of the amortized amount and, again, cannot exceed the financial loss suffered by the entity as a result of the Prepaid.
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