Se fixar a prestação da casa, vou pagar mais juros?

If I pay the installment, will I pay more interest?

Questions regarding the fixing of home loan installments through a government measure remain: Will I end up paying more interest if I join? The Bank of Portugal explains that yes. Learn more in this article.

05 Dec 20233 min

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Do you want to know other options that allow you to lower your mortgage payment? Talk to the credit intermediaries at Poupança no Minuto for simulations of your specific case! Or first understand how the government's interest rate measure works.

Fix the house installment with Government measure: Do I pay more interest?  

The measure has been in effect since November 2 and there are already thousands of requests from customers to banks to adhere to the reduction and fixing of the value of the mortgage installment. However, this is a measure that relieves the installment value in the short term, but in the long run, it will cost more due to the outstanding balance, plus interest.

That is, by hiring this measure in your home loan, you reduce the value of the monthly installment by applying 70% of the six-month Euribor, fixing that value over two years. However, after four years, the differential value between the installment you were paying and the one that you will have to pay in those 24 months, must be refunded, being spread out over the remaining term of the contract.

So, will they pay more interest monthly by implementing this measure in their home loan contract? 

According to the Bank of Portugal (BdP), will pay higher interest rates, "but the contracted interest rate will not change." That is, "from the moment of adhesion, the amount of interest paid monthly will always be higher than what would be paid if you had not adhered to this measure".   

And why? BpP explains that the increase in interest rates "results from the applicable interest rate continuing to be contracted and, additionally, having to pay interest for postponing the repayment of the capital ," so "the total amount of interest to be paid will always be higher."

Remember that you can already request this measure from your bank, if you have a home loan and want to temporarily lower the monthly payment. However, note that the amount you don't pay now will have to be repaid with more interest.

According to news published by Notícias ao Minuto, thousands of requests have already been made to banks to fix the home loan installment and reduce the amount.

Keep the mortgage installment fixed, with no added interest.

But is it possible to fix the installment of your mortgage without having to repay the differential value later and without added interest? Yes.

If you have a loan with a variable rate, linked to Euribor, you can opt for a credit transfer to another bank and adhere to different conditions, such as a fixed or mixed interest rate.

To understand the difference: Currently, Euribor rates are at 4%, while there are mixed rate campaigns that allow fixing the rate in the first 2/3 years, with values starting from 3%. This will result in a significant savings in your monthly loan installment, as well as bringing more stability and security, as during this period you can always count on the same installment value, without surprises.  

When transferring your credit, there are no additional costs, and you will not have to repay any amount later in the term, therefore not having to pay more interest.

If you want to join this option, turn to a credit intermediary, such as Poupança no Minuto. We provide a free mediation service, and negotiate the best proposal for you!    

Contact us today and start saving tomorrow, with Poupança no Minuto!

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