The importance of choosing the right mortgage
The selection of a mortgage is one of the most significant steps in the management of personal finances. The impact of this decision will be reflected in your finances for years, as it involves a substantial loan with terms that can be complex.
Tips for a good choice
Banco Santander has drawn up a guide with five fundamental points that will help you navigate the world of mortgages and find the offer that best suits your needs.
1. Interest rate: Fixed or Variable
When taking out a mortgage, one of the first dilemmas that arises is choosing between a fixed or variable interest rate. The fixed mortgage gives you the security of a constant fee throughout the loan period, making it easier to plan your budget. In contrast, the variable mortgage, which is based on a benchmark such as Euribor, can offer more attractive terms if interest rates are low, but carries a greater risk of future increases.
2. Refund terms: Find the balance
Another factor to consider is the repayment term of the loan. Opting for a longer term may result in lower monthly payments, but it means a higher total cost in interest. Conversely, a shorter term means higher installments, but less interest burden. It is crucial to choose a term that fits your current finances and your future expectations.
3. Financing: How much do you need?
Banks will not normally finance more than 80% of the value of the property, so it is vital that you consider how much savings you can afford. If the purchase price is 200,000 euros, the maximum loan you can get will be around 160,000 euros. Be sure to take into account your available savings and compare the offers of different institutions to get the best financing.
4. Additional expenses: Beyond the price of the house
In addition to the costs associated with the price of the home and interest, it is essential to consider additional expenses, such as opening fees and early repayment fees. Current legislation regulates these costs and sets limits, making it easier to transition between variable and fixed mortgages. Be sure to do a thorough comparison to discover the cheapest options.
5. Additional products: A good deal?
Many banks can offer advantageous mortgage conditions if you decide to secure other financial products with them, such as insurance or current accounts. While these offers may reduce interest, it is essential that you assess whether you really need these additional products to avoid committing to unnecessary expenses.
Final thoughts on your mortgage
Choosing the right mortgage is not just a matter of numbers, but a decision that will influence your quality of life and financial stability. Take the time necessary to analyze your options, consult experts and make an informed decision that fits your financial profile.
