The interest rate of mortgage loans for in many key cities rises at least by 5-10 percent against the benchmark one-year lending rate.
The interest rate of mortgage loans for first-time homebuyers in many cities have increased.
Many cities have continued to raise the interest rate of mortgage loans. The Securities Daily learnt in a recent survey that the interest rate of mortgage loans for first-time homebuyers in some cities has risen 30 percent over the benchmark one-year lending rate; that in many key cities increased 5-10 percent.
30% Interest rate of mortgage loans for first-time homebuyers in Nanjing is 30 percent higher than benchmark rate
A homebuyer told the Securities Daily that when he applies mortgage loans for a commercial residential house in Nanjing in a joint-stock bank, the rate granted is 30 percent higher than the benchmark one-year lending rate, and the down payment reaches 50 percent. The person said that it is the first time that he purchases house in his own name. In response to this, the Securities Daily reporter consulted and surveyed several banks and real estate intermediaries in Nanjing.
"Some homebuyers are indeed granted with mortgage loan rate 30 percent higher than the benchmark one-year lending rate; but most can still apply for mortgage loans at a rate only 10 percent higher than the benchmark rate for the first house,” said an employee in personal loan business at the above-mentioned joint-stock bank.
The reporter then asked about what are main reference indicators when granting mortgage loans. The employee explained that “it mainly depends on the qualifications of buyers, the age and area of the house. Those who buy houses less than50 square meters cannot apply for mortgage loans or may be granted with high interest rates.”
A number of employees from credit departments surveyed by the Securities Daily said that in addition to higher interest rates, whether house buyers can get mortgage loans depend on which houses they bought. They can only get loans when houses are built in cooperation with banks. Some credit department employees said that if they are buying second-hand houses, banks only work with some real estate agencies. Individuals cannot apply for mortgage loans for second-hand houses. After consulting a number of banks and real estate agencies, the Securities Daily learnt that it may take more than three months, or even six months, for banks to grant loans. In addition to suspending lending, the interest rate for first-time house buyer loans rising 5-10 has become a mainstream in the market. Some homebuyers even saw the interest rate of their mortgage loans up 20-30 percent from the benchmark lending rate for the reason of house age and area.
Monitoring data from Rong360.com, a financial information provider shows that the average interest rate of mortgage loans for first-time homebuyers in the 17 banks in Nanjing is 5.03 percent higher than the benchmark lending rate. The highest interest rate is 30 percent higher than the benchmark rate.
It is worth mentioning that housing turnover has slowed down as the government has introduced a serious of policies. Some real estate intermediaries do not work with banks as close as in the past.
“The interest rate of mortgage loans for first-time homebuyers was at least 10 percent higher than the benchmark rate,” an employee from the personal loan business department of a joint-stock bank told the Securities Daily reporter when the latter called the department in the name of home buyer. However, when the reporter consulted an employee working at a real estate intermediary, the employee said that home buyers can apply for interest rate 5 percent higher at the above bank.
When the reporter said that he had consulted the bank before and the minimum interest rate was 1.1 times the benchmark rate, the employee of the real estate intermediary corrected that “the rate should be based on what the bank employee said”.
Many cities raise interest rate of mortgage loans for first-time homebuyers
A report from Rong360.com shows that the average interest rate of mortgage loans for first-time homebuyers around the country in July rose to 4.99 percent, or 1.02 times of the benchmark one-year lending rate. This is the first time that the interest rate of mortgage loans for first-time homebuyer returned to the benchmark rate in four years after 2013. Data shows that the average mortgage loan rate for first-time homebuyers around the country in July rose 2.25 percent from a month earlier, and up 12.38 percent from the 4.44 percent in the same period of last year.
The Securities Daily reporter learned that the mortgage loan rate for first-time homebuyers in many key cities is at least 5-10 percent higher than the benchmark rate.
The rise in mortgage loan rate raised threshold for home purchasing. Given that the mortgage loan is 2 million yuan with a term of 25 years, if the lender pays bank loans at average capital plus interest, when the rate rise 10 percent from the benchmark rate, the interest cost will increase 421,603.07 yuan and the monthly installment payment will increase 1,405.34 yuan compared to last year when the mortgage loan rate is still 85 percent of the benchmark rate.
In addition to the loan rate, the speed of lending also upsets home buyers. A reporter released by Rong360.com shows that as the credit environment has tightened this year, the speed of bank lending will further slow in the next half of this year. Banks is even likely to suspend lending at the end of this year.
Compared to the adjustment of the down payment ratio and interest rate level for those second home buyers, first-time home buyers are more sensitive to the adjustment of the mortgage loan rate. The extension in lending period is not a problem for those who buy new homes, but may be variable for those who buy second-hand houses.
A home buyer told the Securities Daily reporter that "the real estate intermediary suggested that I should apply at higher interest rates for get loans quickly. They said the bank will first grant loan for appliers with higher rates. I am still hesitating to apply or not.”
(Translated by Coral Zhong)
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