Years ago, the habit of borrowing for a home loan changed dramatically, because whoever borrowed at that time required a significant percentage of variable-rate loans. As of the second half of 2018, 72% of new lenders have chosen a fixed installment for years.
We should take into consideration the opinion of the expert, who draws attention to the fact that it is worth revising our existing floating rate loans, as the interest rate increase already announced by the experts may occur and the repayment details of the affected parties may change significantly.
If we look at a 1% increase in interest rates in a specific example, then the installment of a $ 10 million floating rate loan for a 20-year term raises our monthly expenses by $ 5,000.
At the same time, the share of the most risky schemes in borrowing new loans dropped to 6% last year, with borrowers pushing themselves out of the market by opting for floating rate loans. The home market is boosted significantly by predictable fixed-rate loans.
The risk of subprime loans has come
The housing market is showing steady growth, with banks entering into new housing loans worth $ 793 billion in the first 11 months of last year, a 33% year-over-year increase. – said Mellisa Tanchan, a loan expert at RakionBank.
He added that the latest figures also show that the rate of floating rate loans for new home loans has dropped significantly.
The MNB’s new steps, the introduction of qualifying consumer-friendly home loans and the tightening of the rules for borrowing variable-rate home loans from October, play a major role in the change, the expert said.
Switch now would have a longer or more permanent fix
With the option open, though in some cases with different conditions at banks, but you can change the maturity! Either simply with a printout or a more sophisticated new application, but it’s worth the effort to secure our credit.
Those who make this decision make the right decision! It can be seen from the new borrowings that the ratio of fixed loans is increasing significantly, the majority of Hungarians do not want to risk anymore!
If you are looking for a loan, are interested in your options, are considering a loan replacement, call our credit broker to help you make a professional decision!
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