Mortgage quote in Spain: 7.89% fixed for 30 years?

G

GreenBirch

Homeowner
I’ve received a 7.89% quote for a 30-year fixed mortgage on a property purchase around €349,600 in Madrid. The advertised rate was lower, but the arrangement fees and my loan-to-value tier changed the comparison substantially.

For anyone comparing Spanish mortgages, which figure would you prioritise: APR, total interest over 30 years, or total cash paid including fees? I’m also examining monthly affordability, portability and early-repayment terms rather than assuming I can refinance later.
 
I’d calculate total cash cost over the period you realistically expect to keep the mortgage, including fees paid upfront. APR is useful for comparing like with like, but it can obscure the practical effect of a large initial fee if you sell or repay early. I’d run at least 5-, 10- and 30-year comparisons, while keeping the no-refinance case visible.
 
What loan-to-value are they using, and how much of the €349,600 are you borrowing? Without those two figures it is difficult to tell whether the advertised rate was ever applicable to your case. Also confirm whether 7.89% is fixed for the entire 30-year term, rather than a fixed period followed by a variable rate.
 
The five-year comparison is useful, but it creates another question: would the mortgage still be manageable if refinancing were unavailable then? Approval would depend on future income, rates, the property value and the lender’s criteria, none of which is guaranteed.

I would first test the payment at 7.89% for the full 30 years. Keep the shorter holding periods in the spreadsheet, but show refinancing only as an optional improvement rather than something required to make the quote work.
 
A spreadsheet should make this clearer. Put each lender in a separate column and include the initial cash fees, monthly payment, balance remaining after several possible exit dates, and any early-repayment cost shown in the terms. Portability should be compared separately because it only helps if the conditions actually fit a later move. If the rate is fixed for all 30 years, rate-reset risk is not the issue; the bigger risks are affordability and paying to exit early.
 
Agreed on separating portability from the headline cost. I’d also ask each lender to price the same loan amount and loan-to-value before comparing APRs; otherwise the columns still won’t be equivalent. The opening poster’s missing loan amount is probably the key fact. A lower advertised rate based on a different equity contribution is not really a competing quote.
 
You must log in or register to reply here.
Back
Top