Life Insurance And Mortgages In Spain
When buying a house with a mortgage in Spain, it is common practice that the bank will oblige you to take out home and life insurance.
We at efpg would like to show you how much you could save if you change your life insurance from the bank to efpg Insurance Brokers.
When taking a mortgage out with a Bank they will link the home and life insurance, not allowing you to decline or organise these insurances elsewhere. As declining will derive in a rejection of the mortgage.
Banking entities offer much more expensive insurance because they offer it to you as a link to a loan and thus give you a bonus on the interest of said loan.
However, even if you have a lower interest and believe that you are paying less on your loan or your mortgage, really, with the high price of the insurance, you end up paying the same or even more.
Aside from that, the premiums for the home and life insurance are usually included in the mortgage sum, therefore you are paying interest on the premiums of these two insurances.
In addition to all the above, article 15 of the new Credit Law frees the mortgaged party from renewing the insurance "by obligation" with the financial entity that granted the mortgage.
However, if the Insurance is not renewed, the bank is liable to increase the mortgage payments.
Keep reading and we will show you how much you can save if you change your life insurance from the bank.
Let's think that we request a mortgage of €150,000 for our new house, with a duration of 30 years:
- The interest on the mortgage loan is 1.125% with which we will pay €491.12 per month.
Remember that you must also add the price of the linked insurance to this figure.
- Therefore, if you pay around €400 per year for home insurance and around €350 per year for
life insurance with the bank, you will have to add €62.5 per month to the first amount (€750/12
months), being a total of €553.62.
While with the bank a 30-year-old would have to pay around €350 a year to insure €150,000 for life insurance with efpg Insurance Brokers, it would be around €125 a year, (this is under half of what you would pay with the bank) that results in a monthly life insurance premium of €10.
And on top of all this, when it is a couple, the bank assumes that they each cover 50% of the mortgage and therefore the life insurance will only cover 50% of said mortgage.
In the event of the death of one of them, the life insurance will only cover half the mortgage and nothing else.
Leaving them unprotected against the other half of the mortgage and other debts they may have.
As you can see, we have many arguments to review your life insurance and mortgage situation as we could save you some money.
Take advantage of this opportunity NOW! Simply click on the links and fill out a quote form, or call us today on the number above to find out just how much we can save you on your insurance in Spain.
efpg, here for what matters most.