Fixed or variable rate mortgage in Italy

The four rate types

The Banca d’Italia’s mortgage guide (version updated to February 2026) describes four structures.

• Fixed rate (tasso fisso). The rate in the contract stays the same for the whole term. The drawback is that you cannot benefit if market rates fall. The guide says banks “often” apply less favourable conditions than on a variable loan.
• Variable rate (tasso variabile). The rate follows a reference parameter, usually set on money and financial markets, at dates fixed in the contract. At equal duration the variable rate is lower at the start but can rise, and the guide stresses that a rise weighs more on longer loans.
• Mixed rate (tasso misto). The rate can switch from fixed to variable, or the reverse, at set dates or under conditions written in the contract.
• Double rate (tasso doppio). The loan is split in two parts, one fixed and one variable.

The reference parameters named in the guide are the Eurirs for fixed-rate loans, and the Euribor or the European Central Bank’s official rate for variable loans. The bank then adds a margin called the spread (the gap between the reference rate and the rate you actually pay). When you compare two offers, compare the spread, because the reference rate is the same for every bank.

What the ECB figures show for August 2026

The ECB publishes Italian bank rates on new house-purchase loans, grouped by how long the initial rate is fixed. For August 2026, in percent a year:

These are market averages across all new loans, not an offer you will receive. The ECB’s grouping is by initial fixation period, so the first row mixes true variable loans with loans fixed for under a year. Take the table as a snapshot of the market, not a forecast: the figures are provisional and are revised.

The variable-rate benchmark has been moving up. The ECB’s monthly average for the 3-month Euribor was 2.11% in March 2026 and 2.64% in September 2026; for the 12-month Euribor it was 2.57% in March and 3.25% in September. A variable loan is indexed to a rate of this kind, so a reading like this is the mechanism behind the Banca d’Italia’s warning about higher instalments. The ECB’s own deposit facility rate stood at 2.50% after 16 September 2026.

How to decide

The Banca d’Italia does not tell you which to take; it ties the choice to your situation. Its guide says the fixed rate suits someone who fears market rates will climb and wants to know, from signing, each instalment and the total debt. The variable rate suits someone who wants a rate that tracks the market and can bear higher instalments. The double rate is described as a middle way, balancing the pros and cons of each.

Three practical questions follow from that:

1. How much room is there in the budget? The guide says it is reasonable for the instalment not to exceed a third of disposable income. Test a variable loan against a higher instalment, not only the starting one.
2. How long is the term? The longer the loan, the more a rate rise costs you.
3. Is the rate temporary? The guide warns about an “entry rate” (tasso di ingresso) that applies in the first months, with the final rate set later. The gap between the two can be large, so read the criteria that fix the later rate.

For a variable or mixed loan, the APR shown on the information sheet (see TAEG vs TAN explained) is only illustrative, because it can change with the reference rate.

Changing your mind later

Two rights reduce the risk of a wrong choice. Any clause that makes the borrower pay a fee or penalty for early or partial repayment of a home mortgage taken by an individual to buy or renovate a home is void (art. 120-ter of the Testo unico bancario, the consolidated banking act). And you may move the loan to another lender, free of charge: see mortgage portability (surroga).

Which professional to consult

The mortgage broker page explains the trade in general terms: a credit intermediary can compare offers, and the law requires the intermediary to say how it is paid. A notary signs the loan deed with you, and an independent adviser or an accountant can test your budget against a rise in instalments.