Another spectacular expansion in home loans – fixed repayments sweep everything

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The retail credit market is on a steep upward trend, according to the latest data. In the first ten months of the year, banks signed personal loans worth more than HUF 383 billion, which represents a 50% year-on-year increase, an increase of 121% compared to the same period in 2016.

In addition, the housing loan market is booming: new home loan agreements worth more than HUF 720 billion were signed in the first ten months of this year, an increase of 35 per cent compared to the same period of 2017 and 185 per cent higher than in 2016. Both personal loans and home loans are gaining ground in fixed- rate loans that eliminate interest rate risk, according to Good Finance’s analysis based on official central bank statistics and own data.

What’s in the background?


“The personal loans larger family investments are the main purposes, such as buying a car or even home improvement, which is recoverable expenses may be due to housing appreciation. A growing portion of customers appearing in the real estate market is no longer able to get an apartment without credit. At present it has every property people buy on credit . “

He added that the strong growth in the retail credit market was driven, among other things, by the rise in real net wages and the low interest rate environment . As an example, he mentioned that this year the average net income without family allowances was HUF 215 thousand, while in 2017 and 2016 this amount was below HUF 200 thousand.

Overwhelmingly fixed constructions


Good Finance’s analysis shows that borrowers choose secure, fixed-rate schemes that guarantee the same installment over a number of years or even the entire term. “That’s why they are predictable and provide protection against any increase in installments due to a rise in interest rates. We also find that fixed-rate mortgages are most sought after, whether it’s a personal loan or a home loan, ” said Good Finance .

All this, according to market data, shows that in the first ten months of the year, only one-sixth of home loans had floating interest rates, with 83 percent providing a fixed installment for at least one year. 10 l four new akáshitelnél is fixed for at least 5 years of installment debtors. In the case of personal loans, the ratio is 72% with a fixed repayment period of at least one year.

Woman scissors are among the most expensive and cheapest deals


Adam also said that the strong demand in the retail credit market is pushing banks into more competition , with significant differences between the different schemes. “Personal loans can have hundreds of thousands or millions of discrepancies in the total repayment amount, and for home loans, depending on the amount of the loan, a difference of $ 3-5 million is possible.

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