How to choose the mortgage: fixed rates, variable rates, protections and risks

Between rising prices and the difficulties of Italian families to obtain mortgages from banks at the time that increasingly require guarantees, marks a new period of crisis, the Italian real estate market. Yet there are those who continue to buy and asks whether it is better to choose the variable rate mortgage rather than a fixed rate.

The answer right now is yes, yes, the convenience of variable current is strong, considering the new rate cut applied by the ECB, which has literally collapse the cost of monthly installments. The 3-month Euribor has slipped around 0.5% and the monthly index fell below 0.25.

It follows that today you can check a variable rate, evaluating the best deals, just over 3%. But all is not gold that glitters: according to many experts, in fact, the minimum of the Euribor index (which they are linked variable rates) will not stand for a long time and in a few variable-rate mortgages may be subject to sudden increases.

Which was not the case with fixed, whose installment, despite the fluctuations of the market, remains the same, even higher now. However guarantees the borrower a certain tranquility. Finding your way, then, in the world of mortgages? For those wishing to take out a mortgage now, it's probably good to know that the choice of variable rate is more advantageous than the fixed, but, thus always ensures greater safety.

A system, however, to take shelter of any risks is to match the variable rate mortgage a deposit account or another investment that allows you to park their liquidity, even with short time constraints, a tool, in short, where aside the difference between the fixed rate, which would be paid, and that variable, with which you have chosen to start the mortgage because most advantageous.

This choice would give advantage to the borrower to be able to set aside a nest egg to draw upon in the future, in case the variable rate should exceed the fixed rate, and getting interest.

 

22/07/2012

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Translated via software

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Source:

Italian version of ReteIngegneri.it