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Can the Fed Raise Interest Rates Affect Your Mortgages?

Can the Fed Raise Interest Rates Affect Your Mortgages?

A few days ago, US Federal Reserve (FED), applied the highest interest rate hike in 22 years. Response to the collapsing inflation that is recorded in almost half of the world. En, Can a rise in the Fed’s interest rates affect mortgages?

In this article we will explain what is fed y how it can affect mortgagesamong others.

What is the Fed?

Before reviewing the effects that a rise in Central Bank and US interest rates may have on mortgage financing, it is easy to understand. why the central bank controls.
It is the institution that monitors the banking system USAThat is to say Central Bank out of the country. Its aim is to provide economic stability, among its roles is to steer Monetary policy from the United States. What makes it different from the ECB is that it is not only in charge price stability (inflation), but also maximum employment.

At this point, it may seem strange to you and you may be wondering, how the Fed can affect your mortgages.

The effect of the Fed’s rate hike on mortgages

It is clear that the rise in interest rates Fed It does not have a direct effect on mortgages in our country, however, it can have an indirect and imminent effect, causing the ECB to react early.

For several weeks, the president has European Central BankChristine Lagarde, has hinted at her plans for the future with gradual rise in interest rates accompanied by the conclusion of the purchase of debts of the different countries.
The immediate effects of these measures will be seen in the loans, including mortgagesas the fees of those who sign their mortgages at variable interest rates become more expensive.

How to avoid paying more on your mortgage

As we have already mentioned from time to time, in light of the current economic situation we are in and future retaliation from the nation BC with rate hikes is what most experts recommend change from variable to fixed mortgage.

This operation can be performed both from the bank with which the loan was signed and with the change, or through another party through revocation or cancellation.

Remember that if you want to change your mortgage, ours mortgage advisers They can help you for free.

fixed mortgages

Below we will see some of them fixed mortgages with better market conditions:

fixed mortgage Evo Banco

  • Discount interest: 1.24% TIN (1.78% TAE), sin bonificar 1.59% TIN (1.85% TAE).
  • No opening fee.
  • Repayment period up to 30 years.
  • Terms: To gain access to subsidized fees, we must have a legal domicile on the payroll and approve home and life insurance through EVO Bank.
  • free life insurance the first year and 2 years free in payment protection insurance for the first holder.
  • Interest rate: 1.99% (2.18%)
  • Repayment period up to 30 years.
  • terms: no tapes, of any kind.
  • No opening fee.
  • Minimum income € 4,000 net monthly.
  • Type of interest: varies by term of office.

    • Validity 15 years: TIN 1.05% (APR 3.46%) meets the requirements / TIN 2.95% (APR 3.46%) without links
    • Period between 15 and 30 years: TIN 2.05% (APR 2.22%) meets the criteria / TIN 3.05% (APR 3.52% -3.55%) without links
  • Repayment period up to 30 years.
  • Fee: € 500 opening fee. 0.5% for partial and total depreciation and depreciation for the first five years and 0.25% for the rest. Interest rate compensation: 0.75%.
  • terms: Contracts for payroll, employment account or account without pay (0.50% bonus), contractual life insurance (0.60% bonus), home insurance (0.10% bonus) and pension plan with an annual minimum contribution of € 600 (0.10) % bonus). The family unit must have an income of more than 2,000 euros.

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