That means a decrease from 4.725% in September, which confirms the first reduction after 24 months of consecutive increases that have led the mortgage Euribor to more than double its level.
At the moment
How will the fall affect those who have to update their mortgage now? At the moment, they will not find discounts because the average monthly installment – for a loan of 150,000 euros to be paid in 25 years and with a differential of 0.5% – will reach 890 euros this month, 7 less than in September, but 73 more than the average quota of October 2006. A year ago, the Euribor stood at 3,799%, so that the current rise is almost 0.85 points.
The interest rate at which banks offer euros
It is, of course, a less hard review than in recent months. It is the first time that the mortgage Euribor has risen less than one point in a year since April 2006. The Euribor is, as the acronym points out, the interest rate at which banks offer euros to each other (Euro Interbank Offered Rate).
The European Banking Federation calculates it daily with market data at different terms. With the rates of each day of the 12-month Euribor a monthly average is calculated which is the one that applies, with a differential, to the mortgage loans.
Official interest rates
The Euribor usually advances the movements of official interest rates. Many experts believe that the main mortgage index has reached a ceiling in the current phase and that there will be additional rebates in the coming months.
In any case, it is difficult to have downward revisions of mortgages (in relation to the same month of the previous year). The European Banking Federation calculates it daily with market data at different terms, with a differential, to the mortgage loans.