It is likely that you have come to this page without even knowing what an IRPH is and what it consists of. It is an important characteristic that is taken into account when calculating the interest on a mortgage loan.
If you have been granted a mortgage loan, or are thinking of applying for one, it is essential that you know this term and how it affects you when repaying a loan. Keep reading to know how to claim the IRPH?
What does the IRPH mean?
IRPH is the acronym for Mortgage Loan Benchmark Index. It works similarly to how the Euribor does , an index of interest on loans between banks. This is calculated by the Bank of United States and published by the BOE (Official State Gazette).
To be more precise, the IRPH is the interest, generally variable, that is applied to mortgage loans granted by Spanish banks and is calculated taking into account different interests established by different banks over a period of 3 years.
This emerged as an alternative to Euribor after many people suffered with the abrupt changes it suffered in 2008, which reached its highest point, causing many financial problems for citizens, and became one of the most used indexes . It promised to be a more stable benchmark that would deliver benefits primarily to the middle classes.
On the other hand, this was in exchange for the IRPH being more expensive than the Euribor. However, this did not deliver what it promised and on some occasions it proved to be even more volatile than the Euribor. A very particular characteristic is that this is much slower when it comes to reflecting the decreases in interest on mortgage loans than the increases.
It should be noted that the IRPH uses very different indices than the Euribor, and that is one of the reasons why it is higher than the one mentioned. In addition, it is totally at the mercy of the decisions of the banks, that is, they have total control over the interest rates.
He is currently under judicial suspicion and is in the sentencing process, since it is considered abusive to the population. The sentence is expected to be handed down in early 2020 or later this year.
How do I know if my mortgage has IRPH?
This process is as easy as flipping through your mortgage contract. In this contract many references are reflected, but the information required is usually found in the third clause. Another way to check is to look at your interests and know what type of interest you are paying. Generally these interests are higher than what we are used to, between 1.5% and 3% higher than the Euribor.
How to claim IRPH from your bank?
If your mortgage is linked to IRPH , we have good news. You can request a return!
Under investigation, you are given the freedom to claim the money that you overpaid legally. This process is extremely easy.
First, you must send a letter to the lender or bank asking that this interest be eliminated because it is considered abusive. On the internet you can find different templates for this claim that you can send to any entity regardless of whether it is directed to a specific one.
In the event that your claim is ignored or dismissed - which is most likely - you can take your case to court. There may be some complications here, but for the most part, IRPH is being viewed as an abusive interest and established demands are being granted.
Here is a list of the Spanish banks that have applied the IRPH to their mortgage loans:
- Sabadell Bank.
- BBVA or Kutxabank.