A fixed rate does not move for the whole term of the loan. A variable rate is revised at set intervals against a reference index — but in Belgium, unlike other markets, that variation is strictly capped by law.
The legal cap, Belgium's distinctive feature
A variable rate can never exceed twice the initial rate. A loan signed at 3 % cannot therefore be revised above 6 %, whatever the market conditions. Symmetrically, decreases follow the same revision rules.
That cap changes the nature of the choice: the Belgian variable rate is not an unbounded bet, it is a bet whose maximum loss is known at signing. The question left is whether your budget could absorb that maximum loss.
Reading a 1/1/1, 3/3/3 or 5/5/5 offer
These notations read as follows:
| Notation | First revision | Then | Movement per revision |
|---|---|---|---|
| 1/1/1 | after 1 year | every year | ± 1 point |
| 3/3/3 | after 3 years | every 3 years | ± 3 points |
| 5/5/5 | after 5 years | every 5 years | ± 5 points |
The longer the first period, the closer the starting rate is to a fixed rate. A 1/1/1 usually starts lower but exposes you earlier and more often. The doubling cap applies on top of all these limits.
When fixed makes sense
- Your monthly payment is already close to the maximum your budget bears.
- You are borrowing over a long term and want full visibility.
- Current rates are low compared with their recent history.
When variable makes sense
- You have a comfortable margin and could absorb the high scenario.
- You expect to resell or repay early before the first revision.
- The starting gap between fixed and variable is wide, making the short-term saving substantial and certain.
What to compare beyond the rate
The APR includes arrangement fees, the valuation and the cost of credit; it is the only figure comparable from one bank to another. Also look at the linked conditions — salary domiciliation, outstanding balance insurance, home insurance — which often determine the advertised discount, and at the reinvestment fee on early repayment, capped at three months' interest.
The rate also depends on the property
For an equal file, the loan-to-value ratio weighs on the rate offered. Knowing where the property sits in its municipality's market before starting the process avoids discovering halfway through that the bank does not attribute the same value to it as you do.