new incentive for mortgage citizens in October

He Euribor resumes its decline today. This means a new high for mortgaged what in the absence European Central Bank (ECB) lower interest ratesthey take new things for granted reduction in annual application fee his mortgageas happened last September. On Wednesday, October 16, the indicator indicated by the majority of mortgage holders in Spain remained at 2.743% and brings the monthly average to 2.760%.

So half the month passes, opening the door to what could be a mortgage holiday: experts hope the indicator that most mortgage loans fall under V Spain continue moving down. There are those who are surprised that Euribor is already below 3% on a monthly average, but if this continues, they expect it to reach around 2.5% by December.

Such data will leave numerous discounts on mortgage payments. September was an example when annual sales more than 2400 euros. October follows the same scenario. The average remains at 2.7% and is compared to calculate mortgage payment discountwith the highest average Euribor rate last year: 4.16%.

The Euribor rate today, October 16, increases to 2.7%.

Per month October, Euribor rate started in 2.749% and although it has risen, the truth is that it has only fallen recently in anticipation of the expected rate cut by the European Central Bank. For now, mortgage holders are not concerned that they will have to revise their mortgage payments based on the October data, as they will have to compare it with data for the same month in 2023, when the Euribor rate peaked above 4%. Consequently, mortgage discounts will be greater.

This already happened in September. In some specific cases, the person infected variable mortgage of €150,000 for 30 years with annual review, and the Euribor interest rate plus a differential of 0.95% resulted in the monthly payment falling to €100 per month. This represents a reduction of €1,200 per year on your mortgage.

Moreover, if the initial mortgage amount was 300,000 euros, with the same characteristics as in the previous case, the reduction was even greater: 200 euros per month or, what is the same, 2,400 euros per year, according to the data. iAhorro data.

Experts believe Euribor will continue to decline

At the moment, Euribor data shows that the index continues to decline. Sergio Carbajalmortgage officer Trackerpoints out that Euribor fell for 13 months, but previously it rose for 22 months, and “always after a noticeable increase there is a movement of correction and adjustment, which is where Euribor is now.”

For his part, Enrique Diaz-Alvarez, chief risk officer at Ebury, explains that Euribor continues to fall sharply as markets anticipate more cuts from the European Central Bank (ECB). “ eurozone inflation data In September they fell below 2% for the first time since the beginning of 2021. Although the core index – the more significant one – stands at 2.7%, the disinflationary trend is undeniable and will provide cover for further easing of monetary policy.”

On the other hand, it is also mentioned here escalation of tensions in the Middle Eastthat in this regard, “only increased pressure on the ECB to ease its policy and provide monetary support to the economy, although monetary easing will not help the European economy much in the face of a new rise in energy prices. Consequently, markets are almost taken for granted reduction in interest rates at the October meeting of the ECB and the considerable likelihood of a rate cut by 50 basis points at the December meeting.

From iSavings Its representative Laura Martinez expresses surprise at the data currently collected by Euribor “because it was expected by the end of the year” but “everything has been postponed and if we continue like this we will be around 2.6%” . Of course, “since this indicator is so sensitive to external elements, we will have to wait.” From this mortgage comparator They believe that Euribor will remain at 2.6% in December.

However, they disagree on the next ECB meeting, which will take place on October 17. It is possible that the body, chaired by Christine Lagarde, will end up “not cutting rates” at a time when “prices could rise after a few weeks of heavy buying.” Therefore, they choose more “conservative” behavior.

Big discounts until December.

Pending the ECB’s decision, experts estimate the Euribor rate in December at 2.5%-2.6%. This means that mortgage holders renewing their mortgage in the last month of the year can receive discounts of more than €1,200 upfront on a 30-year variable mortgage with Euribor and a 0.99% differential on €150,000. If the guess is double, the discount will be 2400 euros. Mortgage holders have already noticed that this relaxation in September and October is going in the same direction and even more.