Bankinter creates the Dual Mortgage and launches a new loan category that combines the benefits of fixed- and variable-rate mortgages
- The bank has designed a groundbreaking mortgage credit facility that is tailored to the needs of each customer and all types of market environment.
- The customer decides at the time of agreement what percentage of the loan will be taken out as a variable-rate mortgage and what part will be at a fixed rate, with each of them maintaining the respective specific features of that mortgage type.
- The Dual Mortgage helps the customer's decision-making process when opting for one type of mortgage or another, without forcing them to give up the benefits of each type.
Bankinter has given a novel twist to the mortgage market by launching a new category of loan that combines the benefits of the fixed- and variable-rate mortgage in a single product, and in which, unlike with a mixed mortgage, the two interest rates coexist coexist over the lifespan of the loan. In short, this is a unique product due to its characteristics with which Bankinter sets another milestone in terms of financial innovation.
With the launch of this new Mortgage, the bank is placing a mortgage product on the market that is tailored to the current and future needs and characteristics of each customer and to all types of financial environments and interest rates.
The Dual Mortgage allows customers to define from the beginning of the loan what percentage of the mortgage will work in variable mode and what part in fixed mode, each with its respective specific features. In this way, the percentage of capital in the fixed part will be amortised at a fixed interest rate over the entire lifespan of the loan, while the variable element will be amortised in the usual way for this type of mortgage: with a fixed starting rate for the first 12 months of the loan and, thereafter, an annually-reviewable rate benchmarked against the Euribor plus a spread established by the bank. The sum of both amounts will make up the monthly instalment of the Dual Mortgage.
The customer will see a single monthly fee charged to their current account, although the loan information will contain a breakdown of how much of that fee corresponds to the variable tranche and how much to the fixed part, as well as the interest rates applied in each case.
The Dual Mortgage allows the customer to protect part of the debt against increases (fixed tranche), while at the same time benefitting from possible rate reductions thanks to the variable tranche.
In summary, it is a product that offers the client greater flexibility and personalisation by enabling them to choose to what extent they wish to expose themselves to rate fluctuations, either by defining from the outset the percentages of capital in each type, as well as over the lifespan of the loan, balancing this proportion through early repayments.
And the dual nature of the mortgage means it is also open to the early repayments that the customer decides to make over the lifespan of the loan, in which they may decide to use the amortised capital to reduce the pending capital of any of the sections, separately or in both tranches in proportion to the outstanding debt at that time. When repaying, as is usually the case with any mortgage, the customer will also indicate if they wish to reduce the instalment or term.
This option means the customer will be able to balance the percentage of capital owed in the variable-rate and fixed rate parts, depending on personal and economic circumstances along with the market situation, and it may be the case that one tranche of the mortgage matures before the other.
The fact that the loan structure is configured by the customer gives this mortgage a maximum degree of customisation in its conditions.
With the launch of this new Mortgage, the bank is placing a mortgage product on the market that is tailored to the current and future needs and characteristics of each customer and to all types of financial environments and interest rates.
The Dual Mortgage allows customers to define from the beginning of the loan what percentage of the mortgage will work in variable mode and what part in fixed mode, each with its respective specific features. In this way, the percentage of capital in the fixed part will be amortised at a fixed interest rate over the entire lifespan of the loan, while the variable element will be amortised in the usual way for this type of mortgage: with a fixed starting rate for the first 12 months of the loan and, thereafter, an annually-reviewable rate benchmarked against the Euribor plus a spread established by the bank. The sum of both amounts will make up the monthly instalment of the Dual Mortgage.
The customer will see a single monthly fee charged to their current account, although the loan information will contain a breakdown of how much of that fee corresponds to the variable tranche and how much to the fixed part, as well as the interest rates applied in each case.
The Dual Mortgage allows the customer to protect part of the debt against increases (fixed tranche), while at the same time benefitting from possible rate reductions thanks to the variable tranche.
Flexibility and maximum personalisation.
In summary, it is a product that offers the client greater flexibility and personalisation by enabling them to choose to what extent they wish to expose themselves to rate fluctuations, either by defining from the outset the percentages of capital in each type, as well as over the lifespan of the loan, balancing this proportion through early repayments.
And the dual nature of the mortgage means it is also open to the early repayments that the customer decides to make over the lifespan of the loan, in which they may decide to use the amortised capital to reduce the pending capital of any of the sections, separately or in both tranches in proportion to the outstanding debt at that time. When repaying, as is usually the case with any mortgage, the customer will also indicate if they wish to reduce the instalment or term.
This option means the customer will be able to balance the percentage of capital owed in the variable-rate and fixed rate parts, depending on personal and economic circumstances along with the market situation, and it may be the case that one tranche of the mortgage matures before the other.
The fact that the loan structure is configured by the customer gives this mortgage a maximum degree of customisation in its conditions.