Thursday, December 4, 2008

ECB interest rate meeting

The ECB have their monthly meeting today and are widely expected to lop another chunk off the Eurozone base rate. Euribor (inter-bank) rates have been falling steadily since the last round of rate cuts a few weeks ago.

It may help in some territories, but in Spain, most mortgages are based on the 12 month Euribor, and the rates will only vary once a year. So a rate cut will only help the people whose mortgage rates are due for review this month. So 11/12ths of the population will still be on higher rates.

So it will take a full 12 months before the base rate cuts will benefit everyone.

For anyone thinking of taking advantage of the rate falls, a remortgage to a 3-month Euribor rate would be a good option.

Contact us at Europa Mortgages - your best value in Spain, for more details

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