Morgage rates reviewed

| 7 Comments

I was reading the newspaper and it had an article about morgages and how tariffs are dropping once more on friday. Two major banks in Belgium (Fortis and KBC) are offering a rate of 6,15% for fixed mortages over a course of 20 years. If you allow the banks to review the rates every 5 year, it drops to 4,70% and with an annual re-evaluation it can get as low as 3,90%.

All of that sounds nice, doen't it? Since I've got a mortgage for the apartment the idea to have mine changed popped up for a second. After all, if I can get the rate to drop, it would immediately affect my monthly payments. I grabbed my purchase file - I keep these things pretty well organised - and noticed that over 5 years ago, my ex-girlfriend and I signed up for a fixed rate 20 year mortgage at 6%.

I really don't know why the newspaper is announcing such a huge drop in rates now? We got a cheaper loan 5 years ago, and thanks to our decision back then, I'll be paying the exact same amount every month. Sure, it might be slightly higher when compared with the annually evaluated formulas, but it's a pretty good feeling to know what exactly is the cost of mortgage every month, without nasty suprises.

Don't believe everything you read in the newspaper folks :)

7 Comments

i have a fifteen-year mortgage and although the rate is fixed and won't drop, i don't pay much to live in a 4-bedroom house.

"not much" is of course rather relative to one's income I presume?

I got ourselves a rate of about 5.7%
can drop every 5 year(no limit) but can only growth 1% over next 20 years
J

Dimi & I don't like surprises either and definitely not when it concerns our income. So we made the same decisioin: a fixed mortgage! And also cheaper (just a little bit, but it's cheaper) than announced in the paper today: 6.05% at Centea. KBC offered us 6.1 only 2.5 years ago!!! So what's new, pussycat?

Are 20 year mortgages common in Belgium? In the US, I believe the majority of mortgages are 30 year. 15 year mortgages are available, but few people can afford the payments that come with that. My last mortgage was a 30 year at 9% interest, which equaled a monthly payment of $600, and that didn't include taxes or insurance, things which are commonly escrowed into a mortgage...

"not much" meaning that other houses in the area that i live, and of the same size - and smaller, are rented out for twice the amount that i pay monthly towards my mortgage. i'd rather live in a smaller place, to be honest, but the house was bought when i was still married and i have had to take on the mortgage etc, which is 2/3 of my salary. i sometimes wonder how i get through each month.

Just an FYI about current mortgages in the U.S....

The Fed (Federal Reserve Board, who sets things like mortgage rates) just dropped the rates again here in an attempt to get us out of the recession... they've been doing this consistently for a couple of years now.

We bought our current house on a 30-year mortgage at I'm-not-sure what percent, but we had 20% to put down, so that cut out mortgage insurance. Our payment was about $1300 a month, equivalent to a really posh apartment in our area. We have more space than we need (yet), but this was our second house (our starter was very small, with husband/wife/step-child who lives there half-time/four cats/hamster/goldfish.

Rates dropped, so we refinanced after owning the house only about a year. Another 30-year, dropped our monthly payment to $1100.

We refinanced again last week. Another 30-year year, at a 5.15%ish fixed rate, drops the monthly payment to $950. Woo-hoo! Cheaper than most two-bedroom apartments in our area.

(We live in the middle of southeastern Michigan, which for some ungodly reason has prices comparable to Los Angeles and New York.)

....

I could go on about mortgage rates in the '80's and how much my mom paid for her house, etc, but probably everyone is bored to tears. Esp. since U.S. housing has little effect on your issue.

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This page contains a single entry by ServMe published on June 18, 2003 11:45 AM.

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