Lower fixed-rate mortgages on offer in Spain

The latest bank to jump on the bandwagon by offering lower mortgage rates is Bancopopular-e.com, a subsidiary of El Banco Popular. Rates for 25 years (5%) and 30 years (5.5%) compare favourably to those of the BBVA, which started the price war by offering 5.4% for 25 years and 5.7% for 30 years.

El Banco Sabadell, el SCH and Caja Madrid have followed suit although their offers do not extend to 25 or 30 years. That is to say, all large banks except La Caixa are fighting for supremacy. Caja España also offers 3.90% for the first five years.

More specifically, Bancopopular-e is offering 12-year mortgages at 3.90%, 4.40% for 15 years and 4.90% for 20 years. All these loans include an opening commission of 0.75% and 2% for complete or partial cancellation. The mortgages will finance up to 90% of the valuation of the home.

The Bancopopular-e is trying to gauge client response levels. If there are positive results, they intend to incorporate it into their offices.

However, El Banco Popular and many of its competitors do not believe that there will be a fixed-rate mortgage boom. Furthermore, this type of mortgage will only be available to clients that fall into an average to high wage category.

 Source: El Pais Andalusia

Diana Morales, 09 Jul 2003 - Intelligence