The subrogation is a practice that allows you to transfer the loan on your first home to another bank , without additional charges and costs. But what is the surrogate actually? Does it really suit? As you can see, there is still a lot to know. To find out how the subrogation of your mortgage works, we advise you to read our guide, which also contains the most advantageous subrogation offers of the moment .
CONTENTS OF THE ARTICLE
- Surroga: what is it?
- What mortgages can be replaced?
- Substitute and renegotiation: differences
- First house mortgage loan: how does it work?
- Times to request the subrogation of the loan for the first home
- Offers subrogation mortgage
Subrogation: what is it?
The subrogation is a procedure that allows you to transfer your mortgage to a bank other than the one that originally granted it. Also called ” portability “, the subrogation is a very simple service to request and to implement. In the past, costs had to be borne to replace a mortgage. These were then eliminated in 2007, with the so-called ” Bersani Law ” (Law 2 April 2007, No. 40, portability of the loan in Article 8). Inserted in the 2008 Budget, the law prohibits banks from applying costs on mortgage subrogation . Instead, the borrower has the right to ask his bank to transfer the loan to another credit institution . Especially if the latter offers better conditions in terms of installment and interest rates .
What mortgages can be replaced?
Different types of loans can be substituted: those requested for the purchase of land , for example, or those requested for liquidity reasons.
In general, the subrogation is mainly requested for real estate mortgages , especially for those on the first home.
The portability of the mortgage on the first home concerns the vast majority of mortgages required in Italy. The first house is almost always one of the assets on which we invest and spend the most. The cost of the loan, in terms of monthly installments and interest payable, is therefore one of the main expense items of the main house. Nothing strange, therefore, if after asking and obtaining it, better conditions are sought with another credit institution. By now, banks are competing to offer ever more affordable fixed or variable rate mortgages , especially online ones. To take advantage of a mortgage with advantageous conditions, when it already has one, the best solution is just the subrogation.
Alternatively , there is also renegotiation , but the two procedures are totally different .
Substitute and renegotiation: differences
The subrogation involves the transfer of the loan from your bank to another . The renegotiation, on the other hand, provides for the renegotiation of the loan with the same bank.
The subrogation is, in effect, a new mortgage with a new bank, because the contract ends with the previous one. The new loan corresponds, in fact, to the amount of the residual debt with the old bank.
Instead, the renegotiation concerns the same mortgage with the same bank . In this practice the conditions of the current financing are only modified. So, with the same bank you can’t substitute your mortgage, you can simply renegotiate it.
Renegotiating and substituting a mortgage are two different things, but their convenience is practically identical. Both offer the possibility of lowering the installment and the interest on the loan.
The renegotiation is, we could say, more convenient than the mortgage from the formal and bureaucratic point of view , because it does not provide for the transfer of the case to another bank. However, when the contractual terms of the loan prove to be better only in banks other than their own, the subrogation certainly remains the most convenient choice .
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First house mortgage loan: how does it work?
As already mentioned, subrogating a mortgage on the first home is extremely simple. Just make a written request to the new bank and your bank , which, in turn, will have 30 days to accept the transfer .
If your bank refuses, it will incur fines and penalties. For you, however, the transfer will have no accessory cost . The surrogate loan must correspond to the amount of the remaining debt.
With the subrogation, you can change to your advantage:
- duration of the loan
- interest rate and spread
- amount of installments and related collection, investigation and appraisal costs.
The new bank will also not register a new mortgage on the property, because, with the subrogation, the mortgage stipulated with the previous bank will also be transferred .
Mortgages on the first house can all be surrogates, whatever their type. You can substitute the fixed-rate loan to transform it into a variable rate mortgage and vice versa . The objective of the subrogation is in fact to obtain better conditions, including a lower installment . The latter can be lowered by applying a lower interest rate or by lengthening the duration of the loan or, again, by using both options.
Times to request the subrogation of the loan for the first home
The times for requesting the subrogation of the loan depend on the bank that provided it . In general, this time is indicated in the contractual terms of the loan itself.
Some banks provide the possibility of subrogation only after payment of the first six installments. It follows that, in practice, it is impossible to obtain the subrogation of the 100% mortgage, because the transfer of the loan is made only after having paid a certain number of installments to the first bank. In some cases, a subrogation equal to 95% of the loan amount can be obtained.
Furthermore, the subrogation of the loan can be requested over and over again , but in practice, the banks allow it only once . It follows that it is very difficult to ask for subrogation to an already surrogate mortgage . In fact, before accepting the request, the new bank carries out a search to find out if the debtor has already requested previous subrogations. In fact, the tendency to replace a mortgage is an indicator of poor solvency for banks.
Before deciding whether to subrogate or renegotiate the loan, it is advisable to compare the best offers from the banks . To do this quickly, we recommend using the mortgage comparison.