Encourages debtors to replace mortgages
(Hungarian National Bank) has drawn attention to the fact that few people use loan redemption for home loans. The state is increasingly striving to encourage people to take more secure loans. Older borrowers are more affected by loan repayment problems. Loan redemption offers a solution for those who want to upgrade their older loan (s). The Good Finance is planning an action in the near future that will encourage mortgage repayers to convert to longer-term loans. If you are not involved, replacing your existing loan can be a great option.
In Hungary, the loan redemption rate is 3% , which is the number of contracts that customers change for the better each year. Many people are repaying a loan that they have trouble repaying or have already slipped. Solutions to Payment Problems If you have such a problem, you may want to find a solution as soon as possible so that you do not accrue debts.
Riskier loans include floating rate loans and short term loans
These are worth replacing first. The Central Bank has recently been trying to reduce the risk of loans, which has come to fruition. 95% of new borrowers have taken out a home loan with an interest rate of more than 5 years. That is, the repayment will remain unchanged for 5 years and will only follow interest rate changes thereafter, ie it will only grow at that time in line with the BUBOR movement.
The Good Finance plans to send a letter to the most vulnerable target group urging them to buy credit. Mortgage lenders who have taken out a home loan before February 2015, with a very short interest period , belong to this group. The letter you send will contain several offers, but the essence of each will be one and the same, ie promoting a longer interest period, ideally a minimum of 10 years.
Before making a decision, it is good to know that fixed-rate loans and long-term loans are more expensive than variable-rate loans, which is the price of a safe repayment. In return, however, customers will not or will be less affected by interest rate movements.
In the case of floating rate loans
Interest rates may move up or down, depending on the change in BUBOR. It is important that if you choose this type of loan, you should not only expect less repayment, but also an increase. It is worth making a budget before borrowing to see if the advanced repayment will fit into the family budget. Here’s a big question that you don’t know in advance how much your monthly installment might rise. This is the biggest pitfall of variable rate loans, because if you settle yourself, you can easily become indebted. It is no accident that the Good Finance also supports fixed rate loans.
From time to time, everyone may want to consider buying a loan and look around the market every six months to find a better deal. It is definitely worth the switch, even if you can get a free amount of credit by taking out a debt settlement loan.
If you are planning to borrow now
Be sure to consider a fixed rate loan. The Good Finance home loan calculator can help you choose a home loan . Why Use a Credit Calculator? Because it can help you find the best home loan quickly and easily. There is no obligation to use the calculator. All you have to do is enter your details and get a list of credit institutions where you might be able to get a home loan. After that, all you have to do is pick one.