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Mortgage credit.  After all, who cares about a fixed price?

Mortgage credit. After all, who cares about a fixed price?

numberIn the context of rising interest rates and the fear that this upward trend will continue, some bank clients have been considering fixed interest rate proposals. According to the Deco protestFixed-price option is the benefit, above all, for those who want to avoid surprises.

“The big advantage of a fixed rate of interest over home loans is that the consumer knows what they are counting on each month, as the premium does not change with the economic and financial context. In the face of a sharp rise in interest rates, The fixed price option can be advantageous and bring savings compared to the variable“, explains consumer protection regulation.

This is a suspicion that arises “both for those who have a loan in progress, and for those who are going to initiate it”, not least because “it was not so long ago – in 2008 – that the Euribor value exceeded 5%, leaving many families struggling to pay inflated installments.” .

“The shorter the period that the rate remains fixed, the higher the probability that there will be no volatility in the Euribor which offsets what you would pay more compared to financing with a variable rate. That is, Fixed-rate credit for only five years, then indexed to Euribor for the rest of the term, might not be worth itDECO says.

Therefore, the consumer protection organization recommends the following:compare Installments for those first five years with what you would pay on a variable rate credit, when the Euribor rate is 2 or 3%. The Flat rate compensation only if this amount is less🇧🇷

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And more: “If you expect to save some money to reduce credit, consider this The early consumption fee at the fixed rate (2%) is four times higher than the variable rate🇧🇷 In 2023, early amortization of credits at a mandatory variable rate will be exempt from commission. Nor is it likely that banks will renegotiate a fixed-rate contract.”

“In addition to the purely financial aspects, in a context that increasingly seems to precede the crisis, the emotional component must also be balanced, especially if you do not deal well with the unpredictable, and make the right decision on your own,” recommends Dicko.

Read also: Ten questions and answers about amortizing a mortgage loan