What are mortgage certificates?

When we decide to invest in certain financial products, we must take into account the different conditions that we assume when dealing with the options that we have. Today we are going to talk to you about a specific type: mortgage certificates.

We talk about mortgage certificate to the securities that offer us a return that is fixed and issued by financial entities. In this sense, people interested in a mortgage certificate will receive a benefit for the investment in these securities.

The issuance of mortgage bonds will have the mortgage loan portfolio guarantee with which the financial institution has. For this reason, the mortgage certificates may be issued by official credit institutions, savings banks and mortgage credit companies. For this reason, we can say that the tax is on your account.

On the other hand, the profitability of mortgage bonds is usually very good with respect to other financial assets. In many cases, these options have low profitability, but others are usually high. This will depend on the issue that the bank has taken out, as well as the bonds offered by it with said conditions. In any case, and on average, a return of 3% is high for the minimum required in the investment (usually 1000 euros) in the long term.

Finally, we would like to comment on the terms in which we can find the certificates. The normal thing is that these are around a year or 3 years long. We, therefore, find two types of identity cards:

  • Mortgage certificates with special guarantee: This financial product is issued with the guarantee of one or more mortgage loans that are open and must be identified in order to be used.
  • Mortgage certificates with global guarantee: The guarantee of these bonds is based on all the loans of the financial entity that has issued them, except for the loans that support the type of bonds that we have seen previously.