financing

Should I choose a fixed or variable rate mortgage in Spain?

Spanish mortgages come in fixed, variable, and mixed (fixed then variable) formats.

Variable rate mortgages are linked to the Euribor rate plus a spread (typically Euribor + 1-2%).

They're reviewed annually or semi-annually.

Fixed rate mortgages lock in a rate for the entire term (typically 2-4% currently).

Mixed mortgages offer a fixed rate for an initial period (2-10 years) then switch to variable.

The best choice depends on your risk tolerance and market outlook.

Fixed rates provide certainty and protection against rate rises, ideal for long-term owners who want predictable payments.

Variable rates can be cheaper initially and benefit from rate cuts, but carry risk if Euribor rises significantly.

Early repayment penalties differ: fixed rate mortgages typically charge 2% in the first 10 years and 1.5% thereafter, while variable rate mortgages charge a maximum of 0.15-0.25%.

WOW-Estates mortgage broker partners can model different scenarios to help you decide.