Tightening monetary policy has changed the mortgage market. Taking out a loan to buy a house is more expensive. But it also affects those who already have a variable mortgage, as the rise in Euribor has led to a significant increase in fees for these products. Many Spaniards took advantage of the fact that they had saved money to pay off the loan ahead of schedule. Nevertheless, Banco Sabadell clients began to amortize their mortgage lesssince the outstanding balance is basically fixed.

In the third quarter the company They paid off a mortgage worth 436 million euros, which would be approximately 145 million euros per month. According to Banco Sabadell, the majority of down payments are for variable mortgages. However, this figure is slightly lower than the same period last year, when in the third quarter of 2022. €455 million was amortized.just over 150 million euros per month.

Leopoldo Alvear, the company’s financial director, explains that in the first half of the year depreciation was higher, but in the second half of the year it decreased due to the summer. The drop was minor, but it acknowledges that “We do not see a trend towards increasing depreciation”.

At other banks, such as Bankinter or Banco Santander, they saw depreciation increase. In fact, the enterprise chaired by Ana Botín has a monthly amortized amount of 390 million euros per month, five times more than the previous year. In the case of Banco Sabadell, the drop in depreciation is due to the fact that the weight of fixed mortgages is greater, i.e. Business customers have more fixed-rate mortgages than adjustable-rate mortgages..

On the other side, The bank also records a fall in the issuance of new mortgage loans.. In the third quarter of the year, mortgage loans worth €890 million were signed, which is 40% less than in the same quarter of the previous year, when mortgage loans worth €1.472 million were signed. This drop, as explained in the organization, is within the expected range due to the ongoing more restrictive monetary policy, which reduces demand.

Cesar Gonzalez-Bueno, CEO of Banco Sabadell, assured that they did not tighten the terms of the loan in the same sense as Banco Santander said on Wednesday. “We have capital, what else would I want other than to withdraw this capital through a loan. “This is our function,” he noted during the final press conference.

In this regard, the bulk of new mortgage applications are also carried out at a fixed rate, although the variable rate has increased to 35%. The general director of the company is confident that mixed mortgages will be successful. They launched this product in July and it guarantees “And everything is going very well,” adding that “it makes sense now.” In fact, he indicates that this is exactly what he is recommending right now, but he acknowledges that there will be a transition period in which the weight of the variable due to mixed mortgages will increase. “And this is thanks to our specialists who advise, and this is gradually taking root,” he explains.

The company has created mortgage loan officers who are dedicated solely to managing and servicing customers seeking mortgages. For the first nine months of the year 48% of new production was carried out through these agents.which Gonzalez-Bueno is very pleased with.

Early payments and falling new production mean that This quarter, outstanding mortgage balances fell 1.9%. In general terms, Banco Sabadell’s outstanding loan ends September 2023 with a balance of EUR 151,627 million, representing a decrease of 3.3% compared to the previous year due to the repayment of mortgages, lower business investments and loan maturities. loans from public administrations. Compared to the previous quarter, credit decreased by 1.4%, partly due to seasonality.

Given these numbers, Gonzalez-Bueno does not predict an improvement or recovery in mortgage lending in the short term. “There is no visibility into the future because what you see is the next three months because of the new requests that are coming in and They are not at the same level- says the general director. So next year there will be no growth in mortgage activity.