Mortgages: More than half of new contracts were with mixed rates.
The mixed rate has been an interest regime that the Portuguese have very much adhered to when contracting a housing loan, as now confirmed by the Bank of Portugal. Find out why in this article.
Are you looking to hire a mortgage? The credit intermediaries at Poupança no Minuto are here to help. Find out what is the impact of a mixed rate, then make more informed decisions.
More than half of new housing loans in September had mixed interest rates.
According to information released by the Bank of Portugal, shared by Notícias ao Minuto, in September more than half of the new home loans contracted had a mixed rate. In this case, totaling 55% of new home loans with this rate regime.
Note that a mixed interest rate allows you to have access to a fixed rate in an initial period, such as two years, for example, and after this period, it returns to the variable rate.
The average interest rate on new contracts increased in September.
In line with the increase in mixed-rate home loan contracts, the average interest rate on new contracts also increased in September.
According to the Bank of Portugal, the average interest rate rose from 4.23% in August to 4.26% in September.
In addition, also the new credit contracts for individuals increased by 165 million more than in August, totaling 2,504 million. In housing loans there was an increase of 141 million euros, and in loans for other purposes an increase of 39 million euros. Only in consumer loans there was a decrease, of 15 million euros.
Regarding the monthly average payment of the credit stock for own and permanent housing increased to 413 euros in September, six euros more than in August. Comparing this value with September 2022, an increase of 109 euros in the average monthly payment can be observed.
What is the impact of hiring a mixed rate?
As mentioned, the mixed rate implies hiring the two rate regimes together, but divided over a period of time. Initially, the mixed rate starts with a fixed rate value for a certain period, depending on the campaign, returning later to the variable rate.
Currently, Euribor rates, the variable rate benchmark, are around 4%, depending on the contracted term. In contrast, there are mixed rate campaigns where it is possible to fix the rate in an initial period starting from 3.00%, a much lower value than the Euribor rates at this time.
So, that's why this is the interest rate regime that the Portuguese have adhered to the most. This is because they can access a lower interest rate now, returning to the variable rate when it is expected that interest rates and Euribor rates will decrease again.
Are you looking to hire a mortgage loan? Contact the credit intermediaries at Poupança no Minuto to access, for free, simulations of your specific case and help in choosing the best credit proposal for you.
If you already have a variable rate home loan and want to change the interest rate regime, the agents of Poupança no Minuto can help you transfer the loan to another bank with different conditions.