NEARLY half of Spain's homeowners who have a mortgage expect to pay it off before the end of the term, according to a recent survey.
A total of 54% of mortgages in the country were incepted with a term of between 20 and 30 years and a small number are as low as 15 years.
Despite the upsurge of offers of mortgages running for 50 years back in 2007, mainly offered to the under-35s to help them get on the housing ladder due to very high home values, not many existing loans of this nature were taken up.
And across the board, 47% of mortgage holders are confident they will be able to pay theirs off early.
About 26% are not sure whether they will be able to or not, but only 28% were convinced they would need the full mortgage term.
According to the survey by Pisos.com, variable-rate mortgages continue to be the most popular and, in most cases, the most sensible option.
Eurozone interest rates, or the Euribor, which sat at over 5.5% at the end of 2007 is now at around 0.16% and no plans are afoot to increase it.
Any increase is likely to be gradual and with plenty of warning, meaning those who fear their repayments getting out of hand will have time to arrange a fixed rate.
Spanish mortgages are reviewed and revalued annually, which gives homeowners a long breather and time to alter their borrowing strategy if economic factors look set to change.
The 82% of homeowners on a variable-rate mortgage have enjoyed gradually lowering repayments for some years, although the 9% on a fixed rate may have been paying over the odds.
Setting up a fixed rate normally means buying an interest figure slightly higher than that of a variable-rate mortgage, and involves a fee, meaning the potential for extra expense is higher – at times of climbing rates, this could be worth it for security reasons, but now it is likely that the signs would be on the horizon long in advance of a variable rate becoming risky.
Read more at thinkSPAIN.com