Mortgage right time – idealist / news

Surrogate mortgages, the fixed rate goes crazy

The prominent element of the last MutuiOnline.it Mortgage Observatory is undoubtedly the return to the subrogation. A fact driven above all by the trend in interest rates that pushes those who already have a mortgage in place, even if it has recently been activated at already advantageous rates, to try to further improve it by taking advantage of the moment.

On average, in October the variable rate is placed at 0.85% (0.86% in September), while it slightly recovers average fixed rate after the lows reached at the end of the summer e settles at 1.34% (it was 1.27% in September). These are the average market values, but the lows are much lower, like 0.34% and 0.80% for a twenty-year loan, at a variable and fixed rate respectively.

"The subrogation phenomenon returns after a period of stalemate due to the fact that the possibility of subrogating longer-dated mortgages seemed physiologically extinct, – note Roberto Anedda. – At the moment, however, interest rates are particularly advantageous, in particular with regard to fixed rates, so those who ask to subrogate to the mortgage (how many requests are then accepted is another thing), even if they have recently turned it on, it does so with the intention of taking advantage of the new conditions as soon as possible ".

In the period considered over 7 out of 10 mortgage applications are for subrogation (70.8%, when at the beginning of the year it was 38.3%), while on the side of disbursements it is about half of the loans granted (51.7% against 41.1% in the first quarter).

"The new minimum rates, – adds Anedda – have extended the possibility of subrogation also to those who, until a few months ago, already enjoyed a low-rate mortgage and to those who so far had rightly held the original variable rate mortgage. The differential between fixed and variable rates, now reduced to a few tenths of a point, makes the fixed rate a real guarantee of a low-cost mortgage for its entire remaining life, no matter how long it may be. In many cases these are people in their second if not third subrogation. Moreover the subrogation is a completely free operation by law, because no cost is foreseen for the early repayment of the loan at the old bank, for the transfer and even for the notary, all duties borne by the new bank ".

The mortgages are therefore sought mainly at a fixed rate: over 9 out of ten are (93.1% according to the Observatory) thanks also to the low differential with variable rates, especially on average durations.

Mortgage, it's the right time

"The moment is favorable and it will still be for a long time, – predicts Anedda. – In addition to falling rates, we have real estate price levels that encourage purchase and make it much more accessible than in the past. On the other hand, there is also a good willingness on the part of the banks to provide loans ".

What does this come from? availability of credit institutions, at a time when the economy doesn't seem particularly bright? "First of all the opportunity cost of granting credit compared to keeping real estate money is always very low due to the ECB deposit rates that have been very low, thus making it less disadvantageous for banks to grant loans, – explains Anedda. – Furthermore the home mortgage, for Italian banks, has always been one of the least risky credits: there is therefore no real reason to tighten the purse strings, also because the relationship between real estate prices and amounts borrowed is such as to make a borrower suffering less and less likely to suffer. We therefore believe that the availability of the banks will continue also for the coming months ”.

No hurry, then, for those who want to take out a mortgage? "If you want to ask for a new mortgage or a subrogation, there is no hurry," replies Anedda, "in the sense that: rates will remain low presumably also in the first months of next year. It is possible to foresee an increase up to a percentage point, but these are levels much lower than those of some years ago. If you need to have a hurry, more than anything else, it is to start as soon as possible to take advantage of favorable conditions, especially for long durations, which allow you to freeze the current level of interest rates for longer ”.

Mortgages, amounts claimed and paid upwards

According to the Observatory data, the most popular duration is 20 years both in terms of requests and disbursements (respectively 35.5 and 37.1% of the sample). Take advantage of the lucky moment even to ask for higher sums: 143,524 euros the average amount requested in this last part of the year, against the 130.363 euros of the first quarter. Delivery side, the record is even more marked and marks quota 140,101 euros (it was € 127,432 in the first quarter of the year). As for the Loan to value, most Italians mainly require 70 to 80% of the value of the purchase (28.2%) and also the credit institutions finance mainly the same percentage, and to the same extent (28.1%).