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In the first weeks of 2014, the Spanish mortgage market is undergoing some significant changes driven by the advertising campaigns of several banks where they offer mortgages with more affordable interest rate. Spreads have gone from exceed 4% less than 2%, reason why some banks are even offering loans with a fixed interest rate of 4% or less.
These new mortgage products point to a cyclical change and the willingness of banks to lend money in an optimistic market. Another change of trend observed in these products is the change of operative structure of financial institutions, which links the interest rate to the degree of involvement the client is willing to get with the bank (insurance policies, credit cards, other mortgages), so that the more products you hire, the less exigent will be the loans requirement.
Depositing a fixed work income is usually the main requirement of the bank to lower the interest rate mortgages, usually in about 0.20%. A life and home insurances lower the mortgage in about 0.16 %. Other conditions that help to lower the interest rate are hiring payment protection insurance, making frequent use of the credit cards and paying your household bills directly from your bank account.