What is the Spread, and how can I reduce it?
The spread is the bank's commercial margin added on top of the index. It is negotiable — but a low spread only pays off if the total cost falls with it.
In this guide
What the spread is
On a variable-rate loan, the interest rate has two parts: the index (Euribor) and the spread. The spread is the margin the bank sets — the only part it controls, and therefore the part you can negotiate. It stays fixed for the whole contract; Euribor is what moves.
How to bring the spread down
Banks usually cut the spread in exchange for tied products: insurance, salary domiciliation, a credit card, an account with a certain level of activity. Every tenth counts — over a long loan, a tenth of a point on the spread is worth thousands of euros.
The discount that is not one
A lower spread bought with expensive insurance or products you would never use can cost more overall. What matters is the whole package: spread, insurance, fees and the total amount payable. Always compare the total cost, not just the headline margin.
Where we make the difference
Negotiating spread is our ground. We take your case to several banks at once — and when banks know they are competing, the margin they give up changes.
Worked example
On a €200,000 loan over 30 years, cutting the spread from 1.2% to 1.0% lowers the payment by around €20 a month. Over the contract, that is more than €7,000 saved — on the margin alone. (Example figures; actual savings vary with Euribor and term.)
Sources
Susana Vasconcelos
- Intermediária de crédito autorizada pelo Banco de Portugal n.º 0008496
- Mais de 10 anos na banca