Is your mortgage fixation ending? Refixation or refinancing
· 6 min read
In 2021 and 2022 many people fixed their mortgage at a very low rate, often below 2%. Right now those fixations are ending and the bank sends an offer with a significantly higher interest rate. On a mortgage of several million, that can mean an instalment higher by several thousand crowns a month.
What a fixation is
A fixation period (fixace) is a period during which your interest rate does not change. When it ends, the bank sets a new rate according to current market conditions. The end of the fixation is the best moment for a change, because you can repay the mortgage or move it to another bank without penalties.
Refixation: you stay with your bank
Advantages:
- You do not have to arrange anything, just accept the bank's offer.
- No new property valuation and no new contract.
Disadvantages:
- The bank's first offer is often not the best one.
- Without comparing, you do not know how much you are overpaying.
Refinancing: you move to another bank
Advantages:
- A chance to get a lower rate or better conditions.
- When transferring, you can change the maturity or increase the mortgage, for example for a renovation.
Disadvantages:
- A new approval, proof of income and often a new property valuation are needed.
- Processing takes several weeks, so you cannot start at the last minute.
What to look at besides the rate
- Total costs, fees and conditions, not just the interest.
- The length of the new fixation according to your plans for the coming years.
- Conditions for extraordinary instalments.
- Insurance of the ability to repay: check whether it still suits you.
How Tenaryia can help
We watch the deadline, compare your bank's offer with other banks and guide you through the whole process, whether you stay or move elsewhere. Consultations in Czech, Slovak, Ukrainian and Russian, free of charge.
Information is indicative and valid as of the publication date; specific conditions vary by bank or insurer.