Redeeming a loan is a better deal; prepaying many offers is more expensive

The law governing the prepayment and early repayment of mortgage-backed home and freelance loans has recently changed . As a result of the March change, early repayment became more expensive and redemption cheaper.

Individual banks were free to transpose the change in legislation with respect to credit agreements concluded in the past , that is, they could decide whether or not to charge their customers. The pricing of banks has varied, so it is worthwhile to go into detail.

The double free early repayment has been canceled


Important modification, in the case of housing loans in the mortgage secured by the possibility of mandated banks twice-free prepayment eliminated. According to Bankmonitor’s Surveys, banks have largely set new rates for prepayments and early repayments of between 1% and 2%.

Prepayment from own resources became more expensive


It is good to know that from the end of March this year, redemption of loans became cheaper. This can be important to many who are involved in repaying their loans: with this debt management solution, you can swap your loans for one more favorable loan.

But even if you have no problems with repayment and your household budget, it is worth checking and “swapping” our loans from time to time, as 15-20 percent of home mortgage lenders in the United States do annually, for example. In Hungary this ratio is minimal, but the positive change may increase the number of clients who have the opportunity.

Very cheap but expensive internationally


The average APR on Hungarian home loans has been falling for more than 3 years, according to the MNB in ​​July 2015, at 5.75 per cent for home loans to households, reports Market and Profit .

This level is already below the typical cost of FX-based loans before the crisis , so you can get a home loan at a very affordable price.

In European comparison, however, the average cost of Hungarian home loans is still very high, according to the ECB, out of the 28 EU Member States only Bulgaria has a higher rate.