The business of Banks, described in a very simple way, consists of receiving deposits or other reimbursable funds from the public and granting loans or credits with the money received. The difference between what they pay and what they charge is their commercial margin. I say this because the banks cannot function without granting credits, since it is the essence of their business, because if they do not grant them there is no benefit.
After a season of credit restriction, and according to what they say buying public debt, it seems that the banks have launched a strong offensive to get active clients, which is totally legal, making offers of loans and credits that can be tricky . That trick is called bindings.
What are the links?
Well, very simple to offer an interest rate, which depends on the fulfillment of requirements unrelated to the loan. For example, it is said that the interest rate will be Euribor with a differential of 2 points, as long as the client has contracted a series of complementary services such as damage insurance for the mortgaged property, with a company from the same group. than the bank; have payroll, pension, unemployment insurance or social security payment domiciled; make annual net contributions to individual pension plans marketed by the entity for certain amounts; have contracted a mortgage loan amortization insurance marketed by the entity; minimum charges with credit card for certain amounts…
In relation to this way of marketing credits, which is not carried out by all entities, I would make the following reflections:
The complexity of the wording.
The first, the complexity of the wording, which violates the obligation of transparency that contracts subject to general contracting conditions must have, as are the majority of bank contracts, and which in some cases can be classified as clauses. illegible, ambiguous, obscure and incomprehensible.
Wouldn't it be much easier and more transparent to say that the interest rate will be, for example, the Euribor with a differential of 3 points, which can be reduced if certain requirements are met? Well, it seems that it is not the opinion of the minds destined to write the minutes of some banks, who prefer to say that the interest rate is the Euribor with a differential of 2 points, but only if they have contracted the products or services that the bank previously has determined, being subject to an increase otherwise.
The second is the insufficient information provided by some financial institutions, not only to their clients, but also to their own staff, in the banking contracting process.
More than once I have been surprised that the people who have come to sign a mortgage at my notary (which they always do by free choice since I am not the Head Notary of any Bank) tell me that this part of the The loan, that of the links, had not been explained to them before and that they only have news that the interest rate is what it really is, at the time the deed is signed, when it is explained by the Notary, and when it is already hard to pull back.
And it is also true that some office manager tells me that he is also the surprised one, and I do not doubt it, in which case they have to face and in a very unpleasant way the legal geniuses of those who are in the heights of the legal advice of the Banks.
In other words, the same mistakes that were made when marketing the floor clauses are being made again, which would require thinking about the entire banking contracting system, which as it exists does not serve what it was designed to do, which is consumer protection. , because the personalized information sheet, is still not delivered in advance and the right to examine the deed three days in advance, it is impossible to comply on many occasions, because the documentation arrives at the Notary, the same day of signing , sometimes with clients already in the signing room.
The low interest rate hook.
The third is that it is not convenient to be obsessed with obtaining the reduced interest rate, for example the Euribor with a differential of 2 points, if for this purpose certain requirements must be met, since compliance with them costs money.
I will give an example, from these recent days, with a firm that took a little longer than usual, because we stopped to do a cost simulation. It was a loan of 62,000 euros for 15 years, with an interest rate of Euribor with a spread of 2 points, with links, and Euribor with a spread of 3 points, without links.
The difference of one point in the interest rate meant a difference in the monthly payment of 30 euros, a total of 360 euros per year. But to obtain that type of interest, among other things, he had to take out home insurance that cost 500 euros per year, and that he did not need, take out a Pension Plan that he did not need with a minimum contribution of 500 euros per year, and be linked to the bank for up to extremes, that it would lose all kinds of offers from other entities, which in the long run could mean an increase in expenses. In other words, it was cheaper to pay more interest.
I end as always, noting that the best guarantee for consumers in financial operations is the advice of a chosen professional and not imposed.