Adicae warns that mortgages of long term of duration are not of benefit consumer
14.01.2006
To lengthen up to 40 or even 50 years the pay-off period of the mortgages does not suppose ‘any additional benefit’ for the consumer, he warned today the Users' Association of Banks, Boxes and Insurances (Adicae).
The association adds that this way they end up by going out more expensive and the holder has more possibilities of having problems, so much of personal nature - illness or unemployment - as economic - increases of types or recessions-.
According to his calculations, with the current interest rates, the monthly quota of a mortgage for 150.000 euros to 25 years would be 711 euros and the entire interests that it would be necessary to pay in this term would amount to 63.000 euros.
Nevertheless, if the term to return the same 150.000 euros was increasing to 40 years, the entire interests would go off to 107.000 euros and to 139.000 if it was a mortgage to 50 years, what does not compensate, in opinion of Adicae, the low monthly salaries for 532 and 483 euros, respectively, although they are ‘any more commodes of paying’.
Another disadvantage, says the association, is that the longer is the term of return of one more mortgage it is taken in amortizing the given capital and the major are the interests, so that we can be ‘years‘ attending to quotas without having done another thing than paying interests.
As example, Adicae makes sure that, after paying for fifteen years a mortgage loan for 150.000 euros, they still would stay for returning to the bank 74.000 euros if we have hired it to 25 years; 113.000 euros for a term of 40 years and 125.500 euros if the expiration is to 50 years.
According to this association, although ‘from diverse sectors it has been idealized that these offers facilitate the access to the housing of the young people’ and demonstrate the efficiency of our financial system, it would be preferable to take other measures like impelling the construction of protected housing or making the requisites more flexible to obtain public helps.
Another alternative would be to move to the housing the 'leasing', that is to say, the rent with call option that is used at present in the managerial ambience or in the financing of motorcars, what would have the beneficial effect of relaxing the price of the rents and the grade of indebtedness of the Spanish families, as asks the Spanish Bank whenever it has occasion.
Adicae is useful to demand once again the procedure of a Law of Sobreendeudamiento Familiar, who should foresee, for example, to postpone the payment of the quota during a certain period in case difficulties arise to satisfy the debt, like loss of employment or death of a participant.
Source: EFE
Comments
Something on that to comment?
