the IRPH clauses in Spanish mortgages mean higher interest rates and by extension, more expensive payments. There are three ways you can reduce these:
1. Negotiate a deal with your original bank to modify the initial mortgage deeds.
Your mortgage contract can be updated to reflect the Euribor interest rate rather than the original IRPH rate. This could save you up to €1,200 a year on mortgage repayments. Your bank may refuse to do this. If they do accept, be aware that they will probably ask for something in return such as increasing the linkage or differential. Expect to pay associated costs of between 0.1 and 1% of the outstanding capital plus notary, registry and mortgage manager fees.
2. Transfer the mortgage to another bank that agrees to apply a different interest rate (fixed or Euribor).
Once you have an offer from a different bank, your current lender has 15 days to match or improve on the new offer. By law, you must accept this counter-offer. Associated costs for this are approximately 0.5% of the outstanding capital (0.25% if the contract is more than five years old) plus notary, registry and mortgage manager fees.
3. Sign new mortgage deeds with a fixed or Euribor-referenced interest rate to cancel your current mortgage loan.
Of the three options, this is the most expensive because you also have to pay the costs of cancelling the original mortgage.
Note that under the ECJ ruling, IRPH clauses in Spanish mortgages may be declared abusive by a Spanish judge. In this case, you have the right to demand that your bank refunds you the extra charges incurred in all three of the above scenarios.
Note too that in any negotiations with your bank, you should make sure any new mortgage agreement you sign does not include another agreement relating to the IRPH index.