0.75% Fixed Mortgage: Real Offer or Impossible Case
A 0.75% fixed mortgage saving 200 euros monthly over 30 years: a case some call impossible, others explain through strict bank requirements.
English · Original discussion in Spanish · Published
0.75% Fixed Mortgage: 200 Euros Less Monthly and Nobody Believes It
A 230,000 euro mortgage over 30 years, signed two years ago at 2.30% fixed, with a single call that changes everything: the same loan drops to 0.75% fixed, with no early repayment fees, saving 200 euros monthly for three decades. On paper, a bargain. In practice, a case that has united almost no one. The 0.75% fixed mortgage exists, says its signer. The rest demands paperwork.
How to Go from 2.30% to 0.75%
The mechanism is standard in the sector: a high base rate reduced by tying in products. The starting rate is 1.75%. Having a payslip of over 1,500 euros brings 0.25 percentage points less. The couple's payslip brings another quarter. Card spending, life insurance, and home insurance make up the rest, deducting a maximum of one point. Result: 0.75%.
On a house valued at 500,000 euros with 4,000 euros in monthly income between two people, the declared savings are 200 euros per month. The key condition—that the rate won't move even if the Euribor rises to 5% or crashes—relies on the loan's nature: in a fixed mortgage, the agreed rate doesn't change regardless of the index.
The Real Cost of Tied Products
Here begins the fine print not shown in the brochure. Home insurance costs about 310 euros per year; life insurance, 190 and 150 euros for each holder, aged 33 and 31. This is not negligible extra cost, but it doesn't ruin the deal. The key is the floor: to lower the rate, you must maintain payslips, cards, and insurance for the entire loan term.
Some argue the opposite, backed by data. A mortgage with no mandatory conditions, no life insurance, no home insurance, and no car loan costs more upfront but allows choosing coverage freely each year and changing it without penalty. Both models are legitimate; the second requires keeping the rate without bonuses. There is no free lunch, only different ways to pay.
Is a Fixed Mortgage Below 1% Credible?
The short answer is that offers in this range exist, and not just one. Against those calling 0.75% impossible over 30 years, concrete references appear: a 0.90% (1.65% without tied products) with payslip, insurance, and 2,500 euros annual card spending; a 1% over 30 years with payslip only; 1.49% with no ties and 1.29% tying payslip and insurance from a digital entity.
Skepticism has its logic. The best documented fixed mortgage from a user reaches 1.1% over 15 years, but with fourteen distinct conditions. The underlying argument: below 2.3-2.5% over 30 years with no tied products, they say, no one lowers rates, except mortgages for bank employees, around 0.7%. With that benchmark, 0.75% at the same term and rate smells like an exception or error.
Two Years That Changed the Conversation
The issue began with the Euribor around -0.49%, laughable deposit rates, and banks giving away money. In that context, a current held what now sounds reckless: rates wouldn't rise over 25 or 30 years, "look at Japan." Signing fixed at 1% seemed to leave money on the table. Signing variable, the sensible bet.
The pendulum swung. Those who took out fixed mortgages below 1% in February 2021 now boast without qualms, while those who signed at 2.6% four years ago no longer move. Inflation, many thought dead, reappeared, the Euribor stopped being negative, and variable payments began to tighten. The conversation shifted from "long live variable" to "thank goodness I fixed."
The Price of Being Right Over 30 Years
The sarracena here discomforts both sides: those who boasted of foresight during the negative rate era and those who now congratulate themselves for fixing cheaply are, largely, the same people at different times. 30-year predictions are made with today's data, and today's data expire.
One unsettling fact remains. This entire exchange about nearly free money, 0.75% rates, and tied products for three decades was written while the Euribor was heading toward becoming non-negative. No one knows where it will be tomorrow. Almost everyone, however, still signs as if they do.
This case awakens a useful suspicion for any mortgage holder: a low fixed rate with many tied products is never free, only cheaper in the monthly payment. The fine print weighs every year.
A 230,000 euro mortgage over 30 years, signed two years ago at 2.30% fixed, with a single call that changes everything: the same loan drops to 0.75% fixed, with no early repayment fees, saving 200 euros monthly for three decades. On paper, a bargain. In practice, a case that has united almost no one. The 0.75% fixed mortgage exists, says its signer. The rest demands paperwork.
How to Go from 2.30% to 0.75%
The mechanism is standard in the sector: a high base rate reduced by tying in products. The starting rate is 1.75%. Having a payslip of over 1,500 euros brings 0.25 percentage points less. The couple's payslip brings another quarter. Card spending, life insurance, and home insurance make up the rest, deducting a maximum of one point. Result: 0.75%.
On a house valued at 500,000 euros with 4,000 euros in monthly income between two people, the declared savings are 200 euros per month. The key condition—that the rate won't move even if the Euribor rises to 5% or crashes—relies on the loan's nature: in a fixed mortgage, the agreed rate doesn't change regardless of the index.
The Real Cost of Tied Products
Here begins the fine print not shown in the brochure. Home insurance costs about 310 euros per year; life insurance, 190 and 150 euros for each holder, aged 33 and 31. This is not negligible extra cost, but it doesn't ruin the deal. The key is the floor: to lower the rate, you must maintain payslips, cards, and insurance for the entire loan term.
Some argue the opposite, backed by data. A mortgage with no mandatory conditions, no life insurance, no home insurance, and no car loan costs more upfront but allows choosing coverage freely each year and changing it without penalty. Both models are legitimate; the second requires keeping the rate without bonuses. There is no free lunch, only different ways to pay.
Is a Fixed Mortgage Below 1% Credible?
The short answer is that offers in this range exist, and not just one. Against those calling 0.75% impossible over 30 years, concrete references appear: a 0.90% (1.65% without tied products) with payslip, insurance, and 2,500 euros annual card spending; a 1% over 30 years with payslip only; 1.49% with no ties and 1.29% tying payslip and insurance from a digital entity.
Skepticism has its logic. The best documented fixed mortgage from a user reaches 1.1% over 15 years, but with fourteen distinct conditions. The underlying argument: below 2.3-2.5% over 30 years with no tied products, they say, no one lowers rates, except mortgages for bank employees, around 0.7%. With that benchmark, 0.75% at the same term and rate smells like an exception or error.
Two Years That Changed the Conversation
The issue began with the Euribor around -0.49%, laughable deposit rates, and banks giving away money. In that context, a current held what now sounds reckless: rates wouldn't rise over 25 or 30 years, "look at Japan." Signing fixed at 1% seemed to leave money on the table. Signing variable, the sensible bet.
The pendulum swung. Those who took out fixed mortgages below 1% in February 2021 now boast without qualms, while those who signed at 2.6% four years ago no longer move. Inflation, many thought dead, reappeared, the Euribor stopped being negative, and variable payments began to tighten. The conversation shifted from "long live variable" to "thank goodness I fixed."
The Price of Being Right Over 30 Years
The sarracena here discomforts both sides: those who boasted of foresight during the negative rate era and those who now congratulate themselves for fixing cheaply are, largely, the same people at different times. 30-year predictions are made with today's data, and today's data expire.
One unsettling fact remains. This entire exchange about nearly free money, 0.75% rates, and tied products for three decades was written while the Euribor was heading toward becoming non-negative. No one knows where it will be tomorrow. Almost everyone, however, still signs as if they do.
This case awakens a useful suspicion for any mortgage holder: a low fixed rate with many tied products is never free, only cheaper in the monthly payment. The fine print weighs every year.
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Summary of a discussion on Burbuja.info - Foro de economía, actualidad y política., translated from Spanish and reviewed before publication. Read the full discussion (246 replies).
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