The 2.25% cut in Frankfurt reduces (little) interests on smartphones, appliances and cars. The cost of consumer credit drops but remains high.
And cut was. The ECB has lowered rates to 2.25%, Confirming the descent phase of the cost of money after a two -year monetary narrow. What does it mean for Italian families? Loans return to cost less, but not the whole credit market draws the same convenience. The Frankfurt cut does not have the same impact on those who buy a house with the mortgage and those who buy a washing machine or a car a installments.
The best news concerns all those who have or will have a mortgage for the home. And in fact since last May, when the ECB has reversed the route, they started to grow again (+6.5 billion euros). With today’s rates cut, the average fixed rate on mortgages could drop to 2.55%. A great breath of oxygen compared to 4% touched just a year ago. This means that those who today turn on a mortgage will have significant monthly savings. According to the Fabi calculations, a mortgage from 250 thousand euros to 30 years, for example, will have a lighter installment of 203 euros every month (2,400 euros saved in a year). A mortgage of 100 thousand euros at 20 will see a reduction of 76 euros per month for the family.
Five examples of what happens with the cutting of the rates
Instead, saving on payments to installments are less clear. Dilation payments certainly makes more accessible appliances, travel, cars, smartphones, but interests affect, even in a phase of reducing the cost of money. In recent years, with high interest rates, even those on consumer credit had risen, also touching 15%. With the reduction of the ECB at 2.25 of the cost of money, a 7.5% drop is expected in the coming months of the cost of consumer credit, from current 8%.
How much we will spend for products and services in installments? According to Fabi’s calculations with a 7.65% fixed rate, this will be this. A washing machine From 700 euros, bought in installments of 14 euros per month in five years, it will cost us in the end 869 euros, 169 euros more. A smartphone From 850 euros purchased with a two -year loan will be more expensive than 99 euros (949 euros at the end of the two -year period). A TV From 1,200 euros, installments in three years, it involves a final outlay of 1,388 euros, or 188 euros extra. And the more the value of the good grows the more the impact of interest is evident. A trip From 5 thousand euros, spread over three years with a installment of 161 euros per month, in the end it will cost us 800 euros more (5784). Similar speech for a car From 20 thousand euros which with financing in six years in the end has a final cost for 25,683 euros. It means 5,683 euros of interest.
For the amounts contained, the difference may seem negligible, but on medium-high value assets it becomes a crucial factor. In the last nine months, in fact, shopping in installments has undergone a contraction of 3.4%which has reached -5.4% in the case of personal loans paid without a specific purpose.
The cost of money falls and mortgages on families will have a decidedly different weight in recent years than in recent years. Even buying in installments in 2025 will be more convenient, but the accessibility to credit must be kept an eye on.
