What news brings the new Mortgage Law?
The new law establishes a distribution of the expenses of mortgage that supposes a clear improvement for the consumer when constituting his mortgage. The mortgaged future will only have to pay the appraisal, while the financial entity will have to pay the registration, the agency, the notary and the tax on documented legal acts.
Limitation of commissions for early cancellation
Compensation for early amortization, both partial and total, is reduced. In a variable mortgage, the limit will be 0.5% during the first three years and 0.25% during the first five years. As of the fifth year, the cancellation will not have any commission. In a fixed mortgage, the commission cannot exceed 2% during the first ten years and 1.5% for the rest of the term. In addition, compensation may only be collected if early repayment generates a loss to the financial entity.
Regulation of the early expiration clause
The new Mortgage Law establishes stricter requirements to start the foreclosure process. During the first half of the term, the financial entity cannot apply the clause until the delay does not exceed 3% of the granted capital or an equivalent to 12 unpaid installments is reached. In order to apply the clause during the rest of the term, the percentage of unpaid capital must exceed 7% or an equivalent to 15 monthly installments must be reached.
Limitation of linked products
This measure will prohibit all offers that force the mortgaged future to accept a series of financial products linked to your mortgage credit to get approval of your mortgage. Financial institutions may offer their clients relevant products, including the possibility of improving their mortgage conditions by contracting any of these products, providing the client with different budgets with or without related products.
Change from variable rate to fixed rate
The new regulation facilitates and lowers the transition from the mortgage at a variable rate to that of the fixed rate, either with the same entity (the novation) or by changing banks. The commission that can be charged in this case is only applicable if the change occurs during the first three years of the contracted term and will be 0.15%.