The mortgages signed from March, when the new Mortgage Law is expected to enter into force, will incorporate more and clearer information, greater guarantees for the mortgaged and lower costs, since some tax and other expenses must now be assumed by banks.
After almost three years of processing – with two governments of different signatures – Congress gave the green light this week to the law, which now must pass through the Senate, and that seeks to balance the positions between mortgaged and banks after several rulings of the Court of Justice of the EU against Spanish legislation.
The law charges the banks with all the costs of constitution of the mortgage -management, tax of Documented Legal Acts, notary and registry- and only attributes to the client the cost of the appraisal.
The sector and the financial analysts are convinced that finally these costs charged to the banks will end up being transferred to the price of the mortgages.
The result of the play of these factors will have to do with time but the data of the Mortgage Association of Spain in November, after the normative modification that awarded the banks the payment of the Duty of Documented Legal Acts, reveal an increase in the average interest of Mortgages at 2.009% (from 1.932% in October), at levels of two years ago.
One of the central keys of the reform goes through the increase of the protection for the mortgaged: the client will have the contract at least 10 days before the signature so that he can solve his doubts with the entity.
A second guarantee is the most active role that notaries will assume, who must receive the mortgagee before signing to explain any doubts they may have and they will be obliged to confirm that the client knows the product well.
In addition, the entity will have to analyze in depth the financial situation of the client, for which it will consult its history in this matter at the Bank of Spain.
And all this with lower initial costs for those who sign a guaranteed loan for their home, since the client will pay only the appraisal, while the financial institution must bear the costs of agency, tax of Documented Legal Acts, notary and registry.
From the comparator iAhorro calculate that the cost to be assumed by the bank will be in a range of between 2,500 and 9,000 euros, depending on the autonomous community in which the house is located.
Meanwhile, the appraisal cost for the home buyer, who can also choose the appraiser, is between 300 and 600 euros.
The law also defines the terms in which banks may charge the opening commission, which may be charged only once and must include all the costs of studying, processing and granting the loan.
Another of the novelties in the law is the disappearance of the controversial ground clauses, so that it will not be possible to establish a limit to the lowering of the interest rate, although in no case may it be negative.
In addition, customers will not be obliged to contract – as was usual – linked products, such as home insurance, life insurance or cards, among others, but may receive bonuses for the products they hire.
The client may decide to change banks or improve their conditions, since he will be able to subrogate and novar without costs and freely his mortgage.
In the event of an embargo, the law is also more guarantee for the mortgaged, since the mortgage can not be executed in the first half of its life before 12 months of default is met or this is equivalent to 3% of the principal of the mortgage. mortgage. In the second part they will have to spend at least 15 months of non-payment or that the payment has been delayed by the equivalent of 7% of the principal that remains to be paid before the foreclosure.
Likewise, the commissions for early amortization for fixed-rate mortgages are reduced by half (2% during the first 10 years and 1.5% after) and if it is a variable rate, the client will choose the amortization rate at three (0.25). %) or five years (0.15%).
Finally, an Independent Authority will be created to ensure the protection and transparency in real estate contracting and the banking supervision that guarantees the solvency of the mortgaged will be reinforced.