The mortgage market is slowing down, but there are still many buyers looking for home ownership and banks are still betting heavily on attracting them. The stealthy battle that banks have been waging for months in housing credit is sharpening innovation when it comes to creating products in the sector and Bankinter's latest proposal is framed in this context.
The entity has announced on Thursday the launch of a new mortgage formula, the dual mortgage, which allows the client to decide at the time of signing the percentage of the loan that will be constituted as a variable mortgage and what part will be fixed, each of them maintaining the respective particularities of that mortgage modality.
The approach is an evolution of the mixed mortgage, the latest format that has gained weight in the sector in recent months in the heat of the rise of the Euribor and the increase in the price of money. "Unlike the mixed mortgage, the two interest rates [fixed and variable] coexist throughout the life of the loan," explains the entity in a note.
"The dual mortgage allows customers to define from the beginning of the loan what percentage of the mortgage will work in variable mode and what part will do so in fixed mode, each with its respective particularities. In this way, the percentage of capital in fixed form will be amortized at a fixed interest rate throughout the life of the loan, while the variable part will do so as usual in this type of mortgage: with a fixed exit rate for the first 12 months of the loan and, later, a revisable rate annually referenced to the Euribor plus a differential established by the bank. Add the bank.
The sum of both amounts will make up the monthly payment of the Dual Mortgage, something that the buyer must understand very well. "The client will see a single monthly installment charged to his current account, although in the loan information he will have the breakdown of what part of that installment corresponds to the variable tranche and how much to the fixed tranche, as well as the interest rates applied in each case."
The client will be able to define from the beginning the percentages of capital in each modality and also throughout the life of the loan, balancing this proportion through early repayments.
In this regard, Bankinter explains that it may decide to allocate the amortized capital to reduce outstanding capital of any of the tranches separately or to both tranches in proportion to the outstanding debt at that time. At the time of amortization, as is usual in any mortgage, the client will also indicate if he wants to reduce quota or term.