They correspond to the percentage of the credit that is paid in addition to the amount of money requested in it. And that value will correspond to the amount of money that the user will have to pay for the loan service.
Interest rates on mortgage loans: How do these rates affect?
The interest rate is particularly important, given that mortgage loans represent the largest financial product in the market, for the duration of the debt and because the amounts borrowed are the highest granted to a natural person, and this makes That this interest rate corresponds to the percentage that you will have to pay over the loan amount for a large part of your life.
Interest rates on mortgage loans: Types
The different types of interest rates on mortgage loans that exist are described below:
Fixed Interest Rate
It corresponds to the percentage of the loan you will pay, which is the same throughout the entire duration of the loan, without taking into account the duration, or the economic changes that may occur. They are usually higher rates, but they represent less risk, since they do not show variations in the monthly dividend.
It is the most convenient rate for you , if you need a stable alternative and with which you can always pay the same, although it is important that you keep in mind that it is more expensive than other options.
Variable Interest Rate
In this type of rate , the percentage of interest is reviewed annually, which makes it possible to increase or decrease, based on the behavior of the economy. A reference index is used at the time the loan is requested, and each time the anniversary date of the loan is met, the new percentage is determined based on the value of the benchmark index for that time.
This type of rate is generally lower than the fixed rate, since it has a higher risk. And it is recommended only in case of having expectations of income growth, since the most probable rate is that the variable rate increases the monthly dividend a year after applying for a mortgage loan.
Mixed Interest Rate
It is a type of rate that mixes the fixed rate with the variable , as indicated by its name. Its operation is as follows: When the mortgage loan is requested, the bank applies a fixed rate, which is agreed for a certain time, in a range between 3 to 10 years. After this period, a variable rate that has been previously stipulated between the client and the bank begins to apply. And currently, this rate is the most popular in Chile, having about 53% of the mortgage loans requested in the country correspond to this type of rate, according to SERNAC figures.