Since 2015, the domestic housing market has grown significantly. The post-crisis period has been favorable for housing loans, earnings have increased, homes have been built, mortgages on housing have exploded.
Interest rates plummeted, so whoever had a mortgage or freelance home loan. There is one type of credit that was very popular before the crisis, and that popularity has not been regained since: this is a freelance mortgage.
Why is it ignored, what is the reason why you are not interested in it?
The peak of lending was ahead of the 2008 crisis, when the country was in real credit rush, but with the onset of the crisis, the lives of foreign currency lenders were harder than anyone could have predicted. Many families were ruined, evictions followed, foreign currency loans doubled, and often the value of collateral was below the value of the loan taken on it.
Then the cube rolled around, with little or no credit. Many were financially ineligible, excluded from lending, others, seeing the plight of foreign currency lenders – unwilling or unwilling to borrow!
The years have passed, this fright has subsided because the economic situation also seemed to be recovering, earnings were rising, and Hungarian financial institutions were able to lend more and more!
Loans have been used by clients to invest or buy a home, or to spend on consumer goods that have been deferred in recent years. In the past, these needs were covered by free mortgages, but now they tend to take on simple personal loans.
What are the pros and cons of these two types of credit, or even against it?
A freelance mortgage (or “sabfel”) is a mortgage that can be used for anything but does not control what it is used for.
How much cheaper?
For example, if you want to raise $ 5 million for 5 years, one of the best deals
- For Cofidis the monthly installment is 98 279Ft, while the APR is 6.90%.
- At B&L the repayment would be $ 100,170 (THM 7.96%),
- HUF 100,908 at Good Finance Bank (7.90% APR).
- But GFI Bank, for example, has 12.67 percent APR and $ 111,197 in monthly installments.
With Szabfel, we would buy the same $ 5 million for a 5-year overdraft, then we could get an APR below 4%.
- For example, at the Bank of Good Finance it offers the loan in question with a APR of 3.84%, which means a repayment installment of HUF 91,965.
- Bank Offers THM 3.85%,
- and Bank (APR 4.15%).
- For example, Bank offers a 4.90% APR, which is a payment installment of FT 92,693.
Why is it not popular because it is cheaper?
Many are afraid to sacrifice their property, but rather accept a higher installment.
Getting personal loans is much easier! All you need is a proof of income that can withstand the monthly repayments on your loan.
For a “custom” loan:
- a valuation of the underlying property shall be made
- and a loan agreement also requires a notarial deed.
- Although the initial costs are usually borne by the banks in some form, they are often subject to conditions that the customer must meet.
- A secured mortgage loan is not secured if you have more than one owner, if it is already covered as a loan security and only 80% of the property can be debited.
- Personal loans are easier and easier to take out today.
Overall, though, we may be paying a smaller installment on a snapshot loan, but a simple personal loan still has fewer steps to take.
Therefore, first a personal loan, then a free use mortgage.
Banks also urge:
- Up to now the maximum amount of HUF 5-7 million that we could have applied for in this type of loan, now the HUF 10 million loan is unimaginable. Unsecured, with a fixed interest period.
- Of course, the risk of a bank is also greater, since it does not have any cover, the greater looseness means more expensive credit.
Currently offering a $ 10 million personal loan with an 8-year term, with a APR of 7.85 percent:
At such an amount, the difference between the repayment of the two loans may be as high as HUF 15,000, but this is the individual decision of the client.
Personal loans are still leading today, although bank customers generally require much smaller amounts of loans.
If you are looking for a home loan, are interested in GFIC, consumer friendly qualified loans, would like a personal loan, or just inquire, fill out our form and our credit brokerage specialists will tailor their offer for you personally! We call you back!