At the end of March, the National Bank of Tubigon has tightened interest rates, but experts say this step is not yet expected to trigger upward lending rates. But the weeks and months of the low repayers are numbered.
It is considered a warning
After several years, the MNB decided to tighten it once. The change is minimal, but has been unprecedented for a long time: the Daisy Bank has raised the interest rate on the so-called overnight deposit from -0.15% to -0.05% .
This change will slightly increase the interest rates on bank loans to one another and what may be affected by retail products are variable rate home loans. They are linked to inter-bank interest rates.
All of this points out that the period of extremely favorable loans is slowly coming to an end and that there is a need to be careful about opportunities where the repayment agent may be affected by interest rate movements.
True, installments may fall, not just the prospect of an increase. But where THMs are now, they won’t really start down there anymore.
It is always worth thinking about buying a loan
Before the APRs increase, we can swap our floating rate loans, primarily home loans, for a fixed rate. Indeed, a few-digit interest rate hike in the next 15 to 20 years could result in a million-plus.
Many people choose cheaper credit even when they see the risk. There is a big difference between floating rate and fixed rate offers: the interest rate is more favorable than the former. This can mean hundreds of thousands in repayments, but only if interest rates do not rise. And there is no guarantee for this, and all experts predict the trend for the coming years.
The reference rate that the MNB gives can change every three to six months, and accordingly, our seemingly super-cheap credit can become very expensive.
So it’s not really worth thinking about anything else in the near future than the fixed repayment version – the vast majority of personal loans.
The fix is not concreted either
It is worth knowing that banks can even modify fixed rate loans, albeit to a very limited extent. By applying the so-called interest rate change indicator published by the MNB, the lending party may convert the interest rate of our loan.