About Credit Rates

The voices created by the rise in interest rates on loans are not going to go away. In vain, everyone said that for many years there would be no interest rates around 1-2%. This is how the credit market works, this must be accepted. Can you do it? No, but we can disassociate ourselves and plan ahead to repay our credit. The solution could be a fixed rate loan.

 

The basis of loans

The basis of loans

We have often described that loans are basically simple contracts. The bank will give us a one-time larger sum, which in return will be repaid to us over a longer period of time with interest. This is the interest, the profit of the bank, the fee for the bank to advance us the money and “believe in it” to repay it. Simply put, interest is the most important variable that influences how cheap or expensive our credit will be.

 

The loan has interest

The loan has interest

Interest on loans consists of two parts, the reference interest rate and the interest premium. The former is typically the Marble Bank base rate, which is currently 0.9%. To this is added the interest premium charged by the banks on a specific loan. Well, this has risen in the last month and that’s why loans have become a little more expensive . But who is affected?

 

Concept of interest period

Concept of interest period

Of course, whoever is going to take out a loan now has a higher interest rate on their monthly repayment. And those who are now expiring interest on their loans will also have to count on some increase. Those who have fixed their interest rates for a longer period of time, however, are now happy, as they are not affected by this rise.

Namely, the interest period means the time period during which the interest rate of the loan does not rise, and thus the money to be transferred monthly. As it expires, they will calculate our debt reduction under the new terms.

That is why, for whom security is most important in a loan , they should choose a slightly more expensive loan, but with a long interest period! It is worth using our home loan calculator to make your decision more prudent and easier. And if you have any questions, contact us! Our experts will be there to help.

How to save for your child’s education

One of the most important savings goals you can have is to save for your child’s education . It is a long-term goal, especially if you start saving for your education as soon as possible.

How to manage the savings for the education

money

Given its importance we are going to see some important points that I think you should consider if you are thinking about how to manage the savings for the education of your children.

Keep in mind that the easier you put it on your child , on the one hand it is great because it will be easier, but on the other you lose the experience of having, to some extent, that “earning beans .

This experience can be very important later in the future so that you know how to move in the work and economic environment. That is, in the real world.

As much as you want to protect your children , something that logically is very good, sooner or later they will have to face the world of adults.

It may be better for them to face each other in some sense for the first time when they are still young and you are there to help them.

Without further delay let’s move on to the aspects that I think you should take more into account when saving for the education of your children.

Start saving as soon as possible

money

The later you start saving, the harder it will be to pay for your child’s education. If you are going to pay it, start on time, even with small amounts. Ideally, from the first moment you know that you are going to have a child.

Open a savings account and dedicate it to that goal. And as it is a long-term objective, about 18 years, it would also be interesting to find an index fund to take advantage of the compound interest of equities.

Of course do not touch that money under any circumstances.

Save the same for all your children

Be careful not to be too generous with the first of your children, whether your economic situation is going to get worse or not as well as you had thought and for your subsequent children you cannot save the same amount or even anything.

Even to make sure you do it as equally as possible, you should adjust the savings based on inflation. In this way even if the savings of your first child are lower, the expenses of your studies will also be smaller.

Do not harm one of your children for success

If one of your children works hard and earns a scholarship, you may feel resentful if you decide not to pay anything for your education. And then you spend thousands of euros on your brother’s education.

What will you learn from this? That hard work doesn’t matter. Not worth it.

Being unequal with your children can create resentment and misunderstanding. Keep the savings for that child for his post-student time, for a master’s or postgraduate training. Or simply so that once you finish your studies, you already have savings from the beginning of your career.

Don’t compensate a child for doing it wrong

If one of your children studies like a madman and earns a scholarship but another does not touch a book. Do not end up rewarding the second with most of the savings allocated to their education.

As it is “proving” that it is not going to be money thrown in the trash is when you should go giving the money. It can be hard but “spoiling” your children will have a more negative impact on them in the future.

Do not lie or exaggerate what you can bring for your education

Never tell him that he will have something that you cannot accomplish later. If you do it to motivate him and then find that it was a lie, all you will get is to deeply disappoint him.

conclusion

cash

In short, decide soon if you are going to save or not for the education of your children, be fair and just and don’t overdo it or lie about the amount of help.

Are we good with used or new real estate?

The main dilemma is the difference between the purchase price and the state subsidies available for purchase (CSOK, capital write-off, interest-subsidized home loan).

Do the majority of real estate search and buying families hesitate to buy used or new real estate? There are many benefits and drawbacks to both types.

 

Real Estate Thoughts

Real Estate Thoughts

For a newly built property, the buyer will not only be able to choose the coverings, but will avoid any renovation work that must be done on a used property. However, used real estate is cheaper than new real estate, although recent trends are no longer such a difference between the price of a used and new real estate on the market, thanks to several elements of the family support package that will be launched on July 1st.

 

What kind of non-refundable subsidy and discount home loan can I apply for in a used home?

What kind of non-refundable subsidy and discount home loan can I apply for in a used home?

Families may have different levels of CSOK support and discounted home loans when purchasing a used property:

  • For two children, you can apply for $ 1.43 million in CSOK and $ 10 million at a 3% discount home loan.
  • For three children you can apply for HUF 2.2 million CSOK and HUF 15 million 3% discount home loan.
  • For four or more children, the amount of the CSOK is 2.7 million HUF and the 3% discount home loan is 15 million HUF.

Of course, this can also be compensated by applying for a market-rate home loan.

Several changes have been made to the terms and conditions of use of CSOK since 01.07.2019:

  • The upper purchase price limit of HUF 35 million previously used for used real estate was abolished. That is, CSOK support is available even if the price of the property to be purchased is higher than HUF 35 million.
  • A further relief is that it is no longer necessary for the real estate purchaser to invest the full purchase price of the property previously sold in the house or apartment to be purchased.

 

What kind of support and subsidized home loan can I apply for in a new property?

What kind of support and subsidized home loan can I apply for in a new property?

As before, the number of children in the case of newly built houses and flats determines the amount of subsidy and preferential housing loan.

  • For two children, you can apply for 2.6 million HUF CSOK and 10 million HUF 3% discount home loan.
  • For three or more children, you can apply for 10 million HUF CSOK and 15 million HUF 3% discount home loan.

 

What can you do if you do not have the necessary Self-Power?

Do you really not have a Baby Waiting Loan for every bank?

In the vast majority of cases, the above-mentioned preferential home loan amounts and government subsidies do not yet provide sufficient funding to cover the full purchase price of the property. Carefully calculated, buying a property may require up to 30% of own funds, as some banks may have stricter regulations than the law. According to the debt brake regulations, 80% of a property can be encumbered. Thus, the MNB makes the existence of 20% of own funds obligatory. How much do you need then? One thing is certain, given the current real estate market prices, it could be millions of forints.

 

What can be done?

home loan

Include replacement real estate so that the bank takes as a basis the total value of the property. This allows you to make purchases without your own resources.

 

What if there is no other property in the family?

home loan

You can apply for the Baby Waiting Loan (Baby Waiting Grant) as it is a free-of-charge unsecured loan that will remain interest-free until the end of the term (after the birth of a child) if legally required. Moreover, there may be state subsidies for multiple births.

You can take out a personal loan, which is an unsecured but market-rate loan.

In our opinion, it is not possible to decide whether a new or used property is more beneficial to the client. Many subjective elements also contribute to the decision in addition to the above. Whatever you decide on whether you are new or used is worth considering!

Want to know what kind of government subsidies you have and what discounted home loan schemes are available to you? And how much better is it if you use everything? If so, please fill out our form and our credit brokerage specialists will help you find the most appropriate form of financing and support.

How to Use Home Savings for Your Credit!

We have repeatedly said that, as a matter of fact, we advise everyone to have (at least) an apartment savings fund, not just before the loan, but also along with the loan. There are many reasons and arguments for this. And now we’re going to show you how to count home savings and why!

 

About credit

credit loan

Banks were created to lend. Their profit is the interest paid on the loans. This is a win-win for both the bank and the borrower. After all, if you think about it, few at a time have the capital to buy your new property in cash, while the bank has a financial advantage. And this is within a relatively flexible framework, since it does not negate the possibility of reducing our debt at any time with extra amounts. Here comes the picture of home savings!

 

The benefit of home savings

The benefit of home savings

Certainly, many people know that 30% or up to 72,000 HUF of government subsidies are paid for home savings . We can start such contracts for different time periods, such as 4,5,6,8 or even 10 years. After a simple head-to-head calculation , we can figure out that after a contract the state subsidy can reach 720 thousand HUF , but for what term should we start a contract? Let’s figure out which one we do better if we start with 1 8 year contract or 2 4 year contracts!

 

Which one do we do better?

home savings credit

By default, let’s take out a $ 8 million loan for 20 years, for which the loan calculator will charge you $ 40,965 a month. More importantly, we are giving back a total of HUF 9,996,771 to the bank in exchange for HUF 8 million.

If we start an 8 year monthly 20,000 HUF home savings , then after 8 years we can prepay $ 2,627,077 in the 99th month, which means we will repay the 240 month loan in 164 months, a little over 13 years. Thus, together with the saving of the apartment, we come out of HUF 8,638,260, which means we saved HUF 1.3 million compared to the original.

After two 4-year contracts, the trick is to pay off $ 1,300,320 in two installments at once. Interestingly, it only takes 161 months to repay the loan. This saves you an additional 3 * 40,965 HUF, which is 122,895 HUF, and more than 1.4 million HUF in total.

As you can see, we handle the borrowing carefully. Would you like us to help you too? Contact us! You can be sure that we will come up with some similar lucrative solution for you too.