How is the interest rate set in a mixed mortgage?
These types of mortgage loans are a combination of fixed-rate mortgage and variable-rate mortgage. This means that over the first few years the monthly amount does not vary and stays at a fixed rate, like in mortgage loans. As soon as the agreed fixed rate period ends, the mortgage holder starts paying the variable rate. The monthly payments will vary and will go up or down depending on their benchmark index, the Euribor in most cases. This fluctuation depends on the terms established to review interest rates, which is usually every 6 or 12 months.
This type of mortgage loan is very similar to variable-rate mortgages, including some special terms and conditions.
Is a mixed mortgage the same as a combined mortgage?
A mixed mortgage and a combined mortgage are different financial products. A combined mortgage refers to a mortgage loan that simultaneously combines fixed and variable interest, unlike mixed mortgages that include fixed interest in the first period and variable interest in the second but never applied simultaneously.
In combined mortgages, the average of both types of interest is applied, fixed and variable, which means that index fluctuations only affect 50% of the applied interest.