If you own a property in Mortgage, you have surely wondered about the IRPH, in this article about How to know if I have IRPH In my Mortgage it will clear all the doubts that I have regarding the subject.
Continue with the reading that arrived at the indicated place, here you can learn about the IRPH, how to make claims, the calculations that must be made. Everything you should review and many more things that are of interest.
Go ahead and continue reading that will be of great use to you.
How do I know if I have IRPH on my Mortgage?
For all people residing in Spain and who also have a mortgage but do not know if they have a Mortgage Loan Reference Index (IRPH). This index is one of the six benchmarks used by banks to reference a Mortgage in Spain.
This Home Loan Benchmark Index (IRPH) has been applied since 1994 and has been referred to as the average number of mortgage loans. To know if a mortgage is referenced by the IRPH, a review of the mortgage documents or deeds must be done. Also, the mortgage receipts or vouchers can be reviewed.
The steps to follow to find out if the mortgage has an IRPH are as follows:
- First they must perform the review of the mortgage deed or documents.
- Then go to review the third clause that where it indicates about the variable interest rate. In this section, the reference variables of the bank loan must be specified.
- Another way to identify if the mortgage has IRPH, is reviewing each of the receipts or proof of payment of the mortgage loan.
- In case of paying interest above 2%, you can claim the mortgage and the expenses generated that are retroactive in nature.
How to know if I have IRPH on my Mortgage: Claim the IRPH
Once you know if you have a benchmark regarding the mortgage with the Mortgage Loan Benchmark Index (IRPH), then what corresponds to him is to make the claim regarding the refund of mortgage expenses.
You must collect all the documentation required to carry out the feasibility studies of the claims, in relation to the Reference Index of Mortgage Loans (IRPH).
Following, the steps to make the claim correspondent:
- Gather the necessary documents to make the claim.
- Present the mortgage loan deed.
- Attach, the receipts or vouchers for different mortgage loans. Preferably present the latest receipts.
- Also, the deeds of extensions or renovations if they exist.
- Also, present the deed of mortgage loan cancellations in case you have it.
- The request must be made to the bank to eliminate this index and return the amounts paid in excess (it also includes the reduction of the capital pending amortization).
Those interested in pursuing an IRPH claim must submit each of the extrajudicial claims in writing to a bank.
After the extrajudicial claims in the entity bank, the following should be considered scenarios:
- There may be one of negative answer from the bank (It happens in 95% of the cases), then it must be presented before the Courts where they will declare the nullity of the clause.
- The bank does not respond to a relationship at that time. The banking entity has the obligation to answer the claim in the established time two months, if it does not occur, then a lawsuit must be initiated.
Scenarios to take into account after filing the lawsuit to claim the IRPH, are the ones mentioned below:
- In cases where the bank entity receives the demand and accepts itIn addition, you must eliminate the clause and proceed to replace the EURIBOR and refund the various amounts overpaid.
- When the bank is opposed to any of the lawsuits, in this case a trial is held.
You must do the warning not to sign agreements that imply the resignation of the shares for the return of the amounts. In 5% of the cases that positively accept the claim, the bank does so because they stop applying the IRPH, but they oblige customers to waive the refund of the corresponding amounts. These agreements are not admissible from any point of view.
It is recommended in the case that you are thinking of initiating IRPH claims, you should entrust it to a group of lawyers who are experts in the field and can defend your interests. In this way many claims can come out successfully
How to know if I have IRPH on my Mortgage: Calculation
The Mortgage Loan Reference Index (IRPH) is the index that occupies the second place at the time of establishing mortgages in Spain, behind the Euribor.
How to calculate:
- All mortgages constituted in Spain that will last are taken more than three years and then a simple arithmetic mean is performed.
- Any box can influence the result of the IRPH by increasing the interest that applied in the month.
- Should be include fixed rate mortgages.
- Also, variable rate mortgages.
- The calculation It is made from the Euribor, the commissions, the differential and the Annual Equivalent Rate (APR).
- After adding everything up, the Bank of Spain takes the average. In which all banks count the same, whether it grants many mortgages at a low interest rate or a bank that grants a single mortgage at a high interest rate.
This is a calculator that makes it easy to know the amounts to claim from the bank for invalidity of the IRPH.
This calculator works for all types of IRPH and also, you do not need to make any registration or provide any personal data.
You can make the inquiry by here.
Now check carefully and make the query.
Data entry for calculation
- Total (initial) of your mortgage: €
- Total length of your mortgage: years
- Indicate the date of the first monthly payment of your mortgage
- Did you have a initial flat rate for a few months?
- Also, you must indicate the Interest rate on your mortgage: with a differential of%
- How often your mortgage is reviewed
- What month is considered in the interest rate calculation? (usually 2 before)
How to know if I have IRPH in my Mortgage: How does it affect?
Undoubtedly people wonder how the IRPH of a mortgage affects, basically it directly affects the client, since there is no transparency when mortgages are traded with that index.
Banking entities do not clarify precisely to their clients. These entities do not indicate why the mortgage will be related to the residual index instead of another that is more common and favorable with the Euribor,
There is an estimate that there are approximately one million people affected by the banking IRPH. Buyers who were also hurt in a double way, on the one hand paying higher interest and on the other making a lower capital amortization.
What is the IRPH on my Mortgage?
Each person with a mortgage loan can perform the calculation with each of the types of interest that is they must pay with a mortgage. So, the IRPH is a second benchmark index of great importance in Spain, which is behind the Euribor rate.
The supposed IRPH advantage over Euribor it was that it was a less volatile indicator, with fewer oscillations. That is, in theory it would not rise as the Euribor had. In return, the great IRPH disadvantage compared to Euribor is that it was and is more expensive. Specifically, a mortgage referenced to the IRPH will pay between 1.5% and 3% more. In the following calculator you can see how much more it has cost you in your case.
Once you have finished reading this article on How to Know if I have IRPH on my Mortgage, you already have a better understanding of how to calculate the interest on your mortgage and whether or not it is convenient for you to make a claim to the bank.
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