The government froze the rates on the mortgage loans, at October levels, from January to shield consumers from the impact of inflation, initially for six months, later extended until the end of 2022.
The association said the measure "distorts the market" and called the gradual phaseout of the freeze "the only appropriate professional solution." It acknowledged the stability in times of uncertainty the freeze provided to "thousands of households," but added that "tens of thousands" of borrowers benefit from the measure, at lenders' expense, without needing it.
It said the six-month extension of the freeze would cost banks HUF 70 billion, calculated at present interest rates. Other "extra taxes" add up to over HUF 500 bln in "additional burdens" for lenders, it noted. Those burdens could prevent the outlay of some HUF 4 trillion in credit and shave 1% off GDP growth, the association warned.
The association also argued that borrowers had been informed numerous times about the risk of floating-rate mortgages, in line with the law and National Bank of Hungary decrees, and encouraged to switch to safer, fixed-rate constructions.
Producing journalism that is worthy of the name is a costly business. For over 30 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.
