Fixed mortgages remain a safe bet

Fixed mortgage rates are seen by Greek borrowers as a hedge against rising inflation.

Fixed interest rates for mortgages remain attractive to borrowers, who view them as insurance against the heightened uncertainty of ever-rising inflation and floating rates.

Current economic conditions are making many households nervous and impacting their decision to buy a new home, bank managers say. But locking in the rate with a fixed rate mortgage is still a viable and beneficial option for those who decide to take the plunge and take out a mortgage, without the anxiety that floating rates currently induce.

Households paying off old mortgages, whether fixed or variable, and who have been diligent in their repayments are also protected from the ravages of inflation, leaders say. For many mortgages close to maturity, payments are primarily principal, not rate.

And rates should rise further: a reliable indicator are the European Central Bank’s interbank rates. The 3-month Euribor, which serves as a reference for around 90% of the banks’ mortgage portfolio, stands at 0.351%. The 12-month Euribor, which reflects short-term expectations, is at 1.146%, which means an anticipation of rising rates. It is no secret that the ECB decided to raise rates again in September, after inflation in July in the euro zone reached 8.9% and 11.3% in Greece.

Currently, fixed rate mortgages go against the trend of floating rates: they range from 2.90% for a three-year mortgage to 4.20% for a 30-year one.

Eurobank offers rates of 2.90% for three-year loans, 3.10% for five-year loans, 3.50% for 10-year loans, 3.70% for 15-year loans, 3.90% for 20-year loans. years, 4% for 25 year olds and 4.20% for 30 year olds.

National Bank loan rates also vary by loan size: 3.30%-3.70% for 10 years, 3.55%-3.95% for 15 years, 3.80%-4.10 % for 20 years, 3.95%-4.25% for 25 years and 4.10% to 4.40% for 30 years.

Alpha Bank loans only vary by term: 3.20% for five years, 3.40% for 10, 3.60% for 15, 3.80% for 20, 4% for 25 and 4.20 % for 30 years. Rates increase by 0.20% in cases where the mortgage finances more than 60% of the appraised value of the property.

Piraeus Bank’s fixed rates range from 3.35% to 4% for 3-30 year loans, while its floating rates are pegged to the still slightly negative 1-month Euribor plus a margin of 2, 65% to 3.75%.

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