Published by carratelli4 years ago

In this period we are going through a global pandemic that has turned into a real social emergency and this has occurred, as we know, also in Italy...

In this period we are going through a global pandemic that has turned into a real social emergency and this has occurred, as we know, also in Italy. 

An emergency that has become a real war against an invisible virus the Covid-19 ,that has made many victims and that is generating great economic uncertainty for the future.

 

 A valid alternative right now, for future investments, are real estates. Especially when we talk about buying with a mortgage. Let's see why ... A sort of inverse relationship applies between mortgages and the economy, when the economy worsens mortgage rates become more advantageous. To fully understand what has been written previously, we must take into account that the mortgage rates are composed of the spread that remains unchanged until the end of the contract decided by the bank and the two interbank rates, which are subject to market variability.

 

 When we talk about a fixed rate, banks use Eurirs as an index, which must have the same duration as the mortgage. Instead if we talk about variable rate we use Euribor. If we look at the reference index to calculate the fixed rate, then the Eurirs, we see that unlike the previous years where it had always been constant, in March it turned negative, therefore it fell below zero reaching -0.08% . This is leading to a substantial cost difference between a fixed rate and a variable rate mortgage, currently a fixed rate mortgage is more advantageous than a variable rate mortgage. 

 

There are further advantages in the purchase of a property, for example, through the CONSAP guarantee, credit institutions dedicate 100% of the purchase cost of the property to young couples, for those who do not access this category, it can arrive instead at a coverage of 95% of the purchase price. Although the limitations resulting from COVID-19 are restrictive, they do not prevent being able to open a mortgage or contact a credit institution through their respective online channels, which take place respecting all the procedural stages. In summary, therefore, those who open a new mortgage or ask for a subrogation have the opportunity to save significantly on the cost of money in terms of rates.

Carratelli

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