Mortgage payments have taken off. What UOKiK recommends to borrowers [PORADNIK]

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How much will the banking sector cost the bank holidays and the departure from WIBOR?

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Credit holidays. Mortgage suspension

People for whom the repayment mortgage loan is a serious burden on the household budget will be able to take advantage of the so-called statutory credit holidays. This solution allows for a three-month suspension of repayment credit mortgage or consumer loan without adding additional interest or costs. UOKiK emphasizes that this is the best option for those who have just lost their job or their main livelihood.

To take advantage of credit holidays, it is enough to submit an application to the bank via the form on the website finanse.uokik.gov.pl. The bank should suspend the contract upon receipt of the application. UOKiK explains that if you have insurance related to the loan, the bank will inform you about the amount of the premium to be repaid, and the loan period itself, as well as all terms provided for in the loan agreement, will be extended by the suspension period.

“Credit holidays are financially more advantageous for the consumer than bank holidays credit memorandum“- ensures UOKiK. The aid for borrowers recently proposed by the government is to facilitate their availability and relieve them borrowers. This facility is to operate in the years 2022-23. It can therefore be predicted that it will remain in force until interest rates are reduced again.

Credit overpayment and financial cushion

Another solution proposed by UOKiK is overpayment of the loan. It is about early repayment of all or part of the loan, which allows you to reduce the amount of installments or shorten the loan period. Both the outstanding amount and the interest on it will be reduced. “An overpayment on a loan can give you greater benefits than many, including an investment Bank deposit“- assures the office.

If the loan is repaid in part or in its entirety before the maturity date, a proportionate part of the fees, constituting the total cost of the loan, will be reimbursed by the banks. It should correspond to the shortening of the repayment period and be calculated using the straight-line method.

However, some borrowers do not have any funds that would allow them to repay the loan early. There is a so-called financial pillow. It allows you to put some money aside and secure the repayment of higher installments accident unexpected circumstances in the future, e.g. job lossor an even higher rise in interest rates.

“If you can, limit consumption to a minimum in order to build financial security and savings for unforeseen events in the future with small, regular steps” – urges UOKiK.

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Interest rates. Is it worth setting a fixed interest rate?

In addition to postponing or accelerating your loan repayment, you can also change the interest rate to a fixed interest rate. According to information from the Office of Competition and Consumer Protection bank they propose a fixed interest rate, usually for 5 years. Some contracts also reserve fees in the event of overpayment.

“In a situation of rising interest rates, the periodically fixed interest rates proposed by banks are usually higher than the current level of reference rates WIBOR 3M or 6M, but then you have a guarantee that the amount of your installments will not change in the coming years “- explains the office.

However, UOKiK senses that before making such a decision, carefully read the content of the contract and consider whether the fixed interest rate will be profitable, because in the future it may “both increase and be reduced”, and the fixed installment will remain at a constant level.

Credit margin. Can it be changed?

With banks, you can negotiate not only a change in the interest rate to a fixed, but also a loan margin. They change every few years and if the borrower has an agreement with an exceptionally high margin, e.g. over 2.5%, he may negotiate the amount with the bank again. Especially when part of the debt has been paid and the price has been paid real estate increased.

– Thus, the LTV ratio, i.e. the ratio of debt to the value of the apartment, decreases, therefore the margin would be lower in the current conditions. You can apply for a loan change to a cheaper one from another bank – the difference in margins will decrease the loan installment. Such a change will be valid for the entire loan period – explains UOKiK.

Changing the bank may, however, involve the collection of many additional documents, and thus additional costs, e.g. notary, brokerage or resulting from early repayment at the parent bank.

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Borrowers Support Fund. Will government aid work?

The Polish government also announced that it would be strengthened with additional measures Borrowers Support Fund (PLN 1.4 billion in 2022 and PLN 2 billion in 2023). Today, it is about PLN 600 million, which is to provide assistance to borrowers in difficult situations. A returnable loan for debt repayment is granted when the installment is half of the disposable income of the borrowers or when the household income after deducting the installment is lower than PLN 1,200 per person (for a single-person household it is lower than PLN 1,552) and in the event of a job loss.

– Support is granted for a maximum of three years and is paid in monthly installments equal to the loan installment, even up to PLN 2,000. PLN per month. The loan is repaid in 144 interest-free installments, some of which, i.e. 44 installments, may be canceled if the remaining 100 installments are repaid on time, explains UOKiK.

UOKiK has prepared a guide. What will the MPC do?

Inflation in April, by a quick estimate GUS, amounted to as much as 12.3 percent. Every year. This is much more than forecasts and the most since May 1998. Economists boldly predict that on Thursday, May 5, the Monetary Policy Council will raise rates again by as much as 100 bp. Although usually the peak of increases is forecasted at approx. 7-8 percent, analysts of ING Bank Śląski believe that “double-digit interest rates in Poland are no longer a theoretical topic”.

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