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Differences between a fixed and variable mortgage

If you have recently been thinking about buying, it is very likely that you are clear that you will need to acquire a mortgage. However, we are sure that you have searched among the various options that exist on the market today, and it is possible that right now you feel some confusion regarding some concepts. It is for this reason that in this article we want to resolve some conceptual doubts about the two most common types of mortgage in the current context. Indeed, we are referring to the fixed and the variable.

What differentiates fixed mortgages from variable ones?

When the time comes to choose a mortgage, the question arises: fixed or variable? In this sense, we want to clarify what the main difference between the two is. In this sense, fixed mortgages charge the same from the moment they are contracted until they end. On the other hand, variable mortgages have an interest rate that changes over time. That said, although this would be the main difference between the two, there are other aspects that we must consider.

There are more differential elements between both mortgages.

As we have said, it is important that you know that there are more differentiating elements between both mortgages. Below we review two of the most important.

  • The interest: keep in mind that in variable mortgages the interest is calculated by adding the Euribor to a fixed differential which changes depending on the banking entity. In fixed ones, on the other hand, you will always pay the same interest.
  • The fixed exit rate: variable mortgages charge a fixed exit rate during the first months. A fixed interest that is usually maintained for one or two years to which the variable rate then begins to apply. This does not happen with fixed mortgages.

It is true that there are more details that can make the difference between both mortgages, although these that we have explained to you are the most relevant. However, if we have not resolved your questions, we encourage you to contact our team to resolve them.

Do you have more questions? We will be happy to help you resolve any issue.