23 czerwca 2023

Secure credit 2 %. The most important information - conditions, offers, hooks

Secure credit 2 percent. The most important information - conditions, offers, hooks

 

"Safe loan 2 percent" is a support program for borrowers who buy their first apartment or house. The main element of the scheme starting in July are subsidies to installments, which make the loan much cheaper to service than a regular mortgage.

A series of interest rate increases that began in autumn 2021 made mortgage loans available only to higher earners. At the same time, real estate has not gone down. As a result, many planning to buy an apartment or a house had to put their intentions on the shelf. The decline in creditworthiness stood in the way of his own apartment.
The government program "Safe Loan 2 percent" is designed to facilitate access to financing for people who have not owned real estate before and find it difficult to obtain a commercial mortgage loan in the appropriate amount. We summarize the most important information about the latest housing market support program.

 

Who can take out the “Safe 2 percent loan”? Program terms

 

Basic restrictions on access to the "Safe 2% loan" are as follows:

 

  1. The borrower must not be over 45 years old.
  2. The borrower cannot have the right to real estate – the loan with a subsidy is to be used for the first apartment or house.

 

The Act clarified both basic conditions. The first of them, when the loan is granted to co-borrowers who run a household together, is considered fulfilled when the younger of the persons is under 45 years of age.
 

The second condition applies not only to the borrower. It also covers persons who share a household with him. The listed persons may not have on the date of granting the loan:

  • Ownership or co-ownership of a dwelling or a single-family house.
  • Cooperative law concerning a flat or a single-family house.
     

The condition also extends to the past. The borrower may not have such rights before the date of granting the loan, and the person running a household with him/her - during the period of remaining in a joint household.

According to the definitions of the Act, persons forming a household are:

  1.  persons running such a household, i.e. an independent and adult person, or spouses or parents of at least one common child, remaining under their parental authority or legal guardianship. In other words, single, married or parents of at least one common child.
  2. and children remaining under the parental authority or legal guardianship of at least one person running the household and permanently residing with that person.

    The period of leaving in a common household is considered to be the time counted from the date of marriage or (for the other parent of the child) the period from the date of birth of that child.

 

What are the exceptions to the "first property" rule?

 

The first exception applies to a situation where the borrower or a person running a household together with him received the ownership right to no more than one apartment or house:

  • by inheritance or gift
  • and then disposed of them before turning 18.

 

The second exception covers the case when persons running a household together have (individually or jointly) the ownership right to a dwelling or a single-family house in a share not exceeding 50%. and acquired by inheritance, and at the same time they have not lived in this property for at least 12 months.

Similar rules apply to cooperative rights, and the Act also provides for an exemption for real estate excluded from use.

 

What can the “Safe 2% loan” be used for?

 

With the funds from the loan, you can:

  1. Acquire the ownership of an apartment or house on the primary or secondary market, and cover the outlays related to their finishing.

  2. Acquire cooperative law - the right to a flat or a single-family house, including covering the construction contribution in a housing cooperative and the costs of finishing.

  3. Acquire ownership of land or part thereof in order to build a house on it.

  4. Cover the expenses related to the construction of a single-family house.
  5. Cover expenses related to the implementation of a housing investment of a housing cooperative.

 

At this stage, the Act does not include any restrictions on the parties to the transaction, e.g. exclusion of purchases from family members. However, part of the shares in the ownership or cooperative law cannot be purchased on credit.
 

What can be the maximum amount of "Safe Loan 2%"?

 

The program does not provide for any price restrictions for real estate purchased on credit. Therefore, there are no limits, e.g. price per square meter. However, instead of such limits, maximum credit amounts were introduced:

  • 500 thousand PLN for singles and
  • 600 thousand PLN if the borrower runs a household together with his spouse or the borrower's household includes at least one child.

 

The maximum amount of own contribution is PLN 200,000. zloty. 

 

"Safe 2% loan" and house construction

 

The basic limitation, i.e. the limits of 500 and 600 thousand. PLN, is accompanied by several additional scenarios.

If we finance the construction of a house with a loan, and the empty plot is an own contribution, then the value of the plot increased by the loan amount must be within the limit of PLN 1 million.

If we have already started construction before applying for a loan, then the elements constituting our own contribution (e.g. a plot of land with a commenced investment) cannot be worth more than PLN 200,000. zloty.

If, on the other hand, we have an advanced construction that does not meet the previous condition, then one more scenario has been added to the act. We can take out a loan, but its amount will be limited to 100 or 150 thousand respectively. zloty. Additional conditions are:

  • Compliance with the general limit of PLN 1 million (loan amount + own contribution).
  • Granting the loan by the end of 2025.


 

What will the loan subsidies consist of?

 

Subsidies to the loan installments will be paid for the first 10 years of repayment and will reduce the installment amount. Their amount depends on the index to be calculated and published by Bank Gospodarstwa Krajowego. This institution will also deal with settlements with banks that grant "Safe Credit 2%" loans.

The amount of the surcharge depends on the difference between the index and the 2% rate. Thanks to this, the effective interest rate on the loan during the period of receiving the co-financing is close to (but not exactly) 2%. As a result, the loan should have a service cost similar to that in the times of record low interest rates, i.e. until autumn 2021.

The loan interest rate will be periodically fixed, at least for the duration of the subsidies. The rate is to be fixed for a period of 5 years and cannot be less favorable than for the standard offer available at the bank.

 

During the period of receiving subsidies, the loan must be repaid in a decreasing installment formula. After this period, it will be repaid in equal installments by default.

 

When will he lose his subsidies?

 

While the role of the carrot in the "Safe Credit 2%" program subsidies to installments, they are accompanied by an extensive set of scenarios in which it is possible to lose the privilege.
The most important requirement for a typical borrower is probably the requirement that within 24 months from the date of acquisition of the ownership right or cooperative right regarding a flat or a single-family house using the funds of a subsidized loan, the borrower should start running a household in this flat or house. Otherwise, the subsidies to the installments expire on the last day of the month following the month in which the deadline expired, and the amounts of subsidies obtained after that date are returned together with statutory interest calculated for the amount of each of these subsidies from the date of repayment of the installment covered by a given supplement.
Time is counted from:

  • Single-family construction completion notifications.
  • Acquisition of ownership or cooperative law.

    The loss of the right to additional payments will also occur when, among others:

  1. During the period of receiving subsidies, the property will be sold (except for the so-called extension of statutory joint ownership or sale to the other co-borrower).

  2. During the period of receiving subsidies, the property will be rented or lent.

  3. During the period of receiving subsidies, the use of the property or its part will be changed in a way that makes it impossible to meet housing needs.

  4. During the period of receiving subsidies, the borrower will acquire another property (other than by inheritance).

  5. During the period of receiving subsidies, the borrower permanently stopped running a household in a flat or a single-family house for a period of at least 12 months.

  6. The loan interest rate formula was changed to a variable interest rate.

    Payments received earlier, before the date of fulfillment of the condition, will not have to be returned.

     

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Remember that if you have any doubts, I am happy to offer you advice and assistance. Let's meet, you will find that my help in choosing the best mortgage can be invaluable.

 

Feel free to comment. Is the topic of credit analysis interesting for you? Let me know in the comment. Will be happy to help clarify all issues. It is important to me that every topic regarding the mortgage is absolutely explained.

 

 

 

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Michal Kaplon

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60-687 Poznan

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