New exchange rate limit scheme available from Monday
The government's new exchange-rate limit scheme was launched from Monday, available to borrowers who took out forex loans worth a maximum HUF 20 million, are behind on their payments by no more than 90 days and are not part of a repayment-assistance program.
Financial institutions must first accept applications from public sector workers from April 1, then applications from all other home loan borrowers from June 1, and finally applications of borrowers with personal forex loans from September 1.
Banks may also accept applications before these deadlines.
The detailed rules of the special preferencies available for public sector workers are regulated by a government decree published on Friday, March 30.
Clients can apply to participate in the exchange rate limit scheme by the end of 2012 at the credit institutions disbursing their loans. Clients with a financial leasing agreement for residential property may also apply to participate if the agreement was signed before December 15, 2011.
Banks will temporarily apply an exchange rate of HUF 180 to the Swiss franc, HUF 250 to the euro and HUF 2.5 to the yen during the scheme. The balance compared to market rates will be booked on a special buffer account.
The interest component from the part of the monthly repayment above the exchange rate limit will be cancelled, borrowers will only have to repay the principal part, including interest on the latter, according to the rules relating to the buffer account loan.
Above a set top exchange rate level (HUF 270 for the Swiss franc, HUF 340 for the euro, HUF 3.3 for the yen), the part of the repayment exceeding the top exchange rate will be paid by the state.
The preferential-rate period will last five years, but until June 2017 at the latest. Clients can initiate termination of the exchange rate limit after the expiry of three years.
Financial institutions must do their best to ensure that the credit limit agreement will be concluded within 60 days from receipt of a complete application. Buffer account loan agreements that have already been concluded will be amended in accordance with the new rules unless the debtor refuses to give his/her written consent.
ADVERTISEMENT
Financial Transformation: Now or NeverÂ
Gov't Extends Deposit Rate Cap Till Year-end
Media Markt Sanctioned for False Advertising
'Creating CEElicon' Valley in Focus of HVCA Investment Confe...
SUPPORT THE BUDAPEST BUSINESS JOURNAL
Producing journalism that is worthy of the name is a costly business. For 27 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.
