La Nueva ley hipotecaria
With an estimated date towards the end of May, the new mortgage law will come into force, with which the new mortgages will enjoy greater clarity in the contracting of the mortgage and savings in its formalisation.
Asmcasas, your estate agent in Valencia, explains in depth the advantages of this law compared to the previous one.
Advantages of the new mortgage law
A law that seeks greater transparency in the contracting of mortgages and a distribution of costs between the bank and the client established in the law itself.
Clear and unbinding banking offer of products
When we decide to take out a mortgage loan, we begin to hear concepts that we are completely unaware of.
With the entry into force of this law, entities will have to provide more and clearer information, which will possibly become a service provided by specialised professionals within the entity for the management of mortgages.
The obligation to take out mortgage-related products such as insurance, cards, pension funds, etc. will also be left behind. However, banks can improve their mortgage offer to customers if they decide to take out some of these products.
Greater credit control
Two main rules directly affect this point, on the one hand the bank will not be able to offer incentives to its employees for the “Sale” of mortgages. In addition, banks must carry out an exhaustive study of the customer’s solvency and debt capacity.
With this measure, a tightening of the customer’s personal conditions for granting the credit can be expected.
Also on this point, everything related to non-payment and eviction processes is established. From the current three months of non-payment for the bank to begin the process of foreclosure, this will rise to 12 in this new law or the equivalent of 3% of the amount lent by the bank.
This refers to mortgages in the first half of the life of the mortgage loan. In the second half, these figures vary in favour of the customer, amounting to 7% of the total loan or 15 unpaid instalments.
Interest on arrears will also be legislated for. It is prevented from exceeding the interest on the mortgage loan by more than 3 points.
Revision of the contract and notary
Having the contract available 10 days before the signing for its revision and two visits to the notary instead of one, are the measures that are reflected to offer a greater transparency and information to the client.
The notary must also ensure that the customer fully understands what he is contracting for, check that there are no abusive clauses and resolve any doubts he may have with the customer.
The client will assume the cost of the appraisal of the home as a single expense in the formalisation of the mortgage loan.
The entity will be in charge of the tax of legal acts, registry, notary and agency costs. The cost of additional copies will be charged to whoever requests it.
Formalisation and amortisation fees
Early repayment of a mortgage loan will also be cheaper. In mortgages with a fixed interest rate, during the first 10 years it will be 2% and 1.5% after that time.
In variable mortgages, the reduction is also noticeable, being 0.25% for the first 3 years and 0.15% afterwards.
There is no limit to the opening commission, but it can only be charged once and this must include all the concepts that the bank wants to pass on to the customer.
Mortgage novation and subrogation
Changing a fixed-rate mortgage to a variable-rate mortgage within the same entity will also be cheaper. The entity can only charge 0.15% for the novation during the first three years and after that date, it will be free.
In the case of subrogations, i.e. changing the loan from one entity to another, this will be free of charge and both entities will have to make a compensation between the interest charged and the interest pending.
Many new features that will undoubtedly help to improve the information when contracting a mortgage loan. Not so much in the price to be paid for it, as although the costs are limited and most of the formalization expenses are charged to the entities, it is also true that the majority of entities have already increased the price of the product so that these measures have a minimum financial impact on the entity.
Consult us if you want to buy your house in Valencia and we will advise you on the purchase and mortgage procedures.