Mortgage glossary

A tax paid when certain deeds are signed, a kind of stamp duty. On a new home the buyer pays it; each autonomous community sets its rate.

The gradual repayment of the borrowed capital. Each instalment repays part of the capital and pays the interest for the period.

A table that shows, month by month, how much of each payment is capital, how much is interest and how much is left to pay.

A one-off payment to the bank for granting the loan. It is included in the TAE.

The part of the property price the bank does not finance and which you pay from your savings.

Repaying part or all of the capital sooner than planned. It can be partial or full and, depending on the contract, may carry a fee. See the guide.

Compensation the bank may charge if you repay capital early. Law 5/2019 sets maximums depending on the type of mortgage.

The European market reference interest rate most variable mortgages are tied to. See the guide.

The document the bank hands over with the loan offer, summarising its main conditions, including the TAE.

A mortgage whose interest rate does not change during the whole term.

An amortization system with a constant payment: at the start you pay more interest and, over time, more capital. See the payment guide.

The transfer tax paid by the buyer of a resale home. Each autonomous community manages it and sets its rate.

The tax paid when buying a new home. For housing the reduced rate of 10% generally applies.

A mortgage with an initial period at a fixed rate and a later stretch at a variable rate.

A change to the conditions of a loan with the same bank, for example the interest rate or the term.

The part of the loan you have not yet repaid. It is the base on which each month's interest is calculated.

The money you contribute yourself in the purchase: the deposit plus taxes and costs.

The regular payment, normally monthly, which includes capital and interest.

The moment when the rate of a variable mortgage is updated with the new value of the index. It is usually annual or half-yearly.

The margin the bank adds to Euribor on a variable mortgage. It is set in the contract.

A change of lender: another bank takes over your loan.

The yearly cost of the loan including the interest rate and the associated fees and costs. Used to compare offers. See the guide.

The total time, in years or months, over which you repay the loan.

Products the bank asks you to take (insurance, payroll, cards) in exchange for a lower rate. Their cost must be added when comparing offers.

The annual interest rate applied to the outstanding capital and used to calculate the payment.

An appraisal of the property by an approved company. On a mortgage loan the borrower pays for it.

A mortgage whose rate is a reference index, normally Euribor, plus a spread, and is reviewed periodically.