Experience has shown that a key factor in the selection of the mortgage, the interest rate acts. Any bank sets the amount of mortgage interest on an individual basis for each loan, which is issued to the borrower, because it affects the object to be lending, the form in which the confirmed income, the type of market where purchased "square meters" (secondary or primary), the original contribution and, of course, the credit period.
All mortgage loan rates are divided into three types:
The most widely used type of fixed rates, which in any case do not change over time given a mortgage loan.
Second in popularity are floating rates, attach to the average value of the interest rate, which operates in the interbank market. Simply put, mortgages issued in foreign currency, will refer to the interbank exchange of London. Sometimes, however, the rate on the loan in a currency, the euro can be attached to the European interbank rate. And when the mortgage rate is indicated in rubles, it is directly linked with the Moscow interbank market level loans.
Any floating rate mortgage notes specific index, which characterizes the interbank market:
rate related to the stock exchanges in London, there is an indicator of LIBOR, formed on the platform of interest rates, which belong to several major world-class banks. As this indexation rule, mortgage rates are designated as 6% + LIBOR and 7% + LIBOR, etc. With regard to the borrower, it is annually informed your lender about mortgage rates change, and what interest he must pay for the next year.
take a mortgage in rubles MosPrime indexed value and is created only on the basis of the contributions indicated in rubles on the Moscow market. These bets are referred to as MosPrime3M + 5% and + 5% MosPrime6M. It is worth considering that the market of the Russian capital rates are subject to change every three or six months.
There are other rates that are linked to values such as the Pibor (Paris Bourse), FIBOR (Frankfurt Stock Exchange), MIBOR (Moscow alternative to LIBOR) and TIBOR (Tokyo Stock Exchange).
3. The third type of mortgage rates, is characterized as a combination. This bet type involves fixing rates for the first few years of the mortgage loan, and then begins to take effect floating rate.
If the borrower does not know what rate to give preference to, he begins to compare them. However, comparing mortgage rates, you need to consider some important points. For example, if the bank issues a loan at a floating rate, it is usually worth less fixed. However, floating rate trust less than fixed, so in this case, the benefit goes shoulder to shoulder with the risk. And the thing is that variable rate, although it is at the beginning of lower fixed payments, too, can grow.
Currently, fixed rate mortgage is gradually reduced, as far back as 2011, the government encouraged banks to reconsider the value of fixed interest rates and give young teachers, mortgage loans at 8.5% per annum. Naturally, with the social mortgage is expanding every year, but the prices do not stand still, so now all the government forces and banks are applied to ensure that regulate this relationship.