The OP states that the approach of the interest rate review date has increased the number of additional loan deductions.
The rise in interest rates has increased the popularity of short-term reference rates and caused Finns to make additional loan cuts, the cooperative OP Group said in its press release.
After long years of zero interest rates, customers are more actively looking for different options than before, which is a good thing. The interest rate environment is normalizing, as the current interest rate distribution is similar to the time before zero interest rates, the OP director responsible for individual customer financing and housing services, said in the press release.
Whereas last summer almost all housing loans taken out from the OP group were linked to the twelve-month Euribor, already in March this year every fourth loan was linked to the three- or six-month Euribor.
During the summer, the final interest rates on long-term mortgages are also updated, which are still in line with last year’s low interest rates.
The bank says that even though mortgage interest rates have already been updated for a large number of customers, 60 percent of mortgage loans linked to 12-month Euribor and without interest rate protection are still at the end of the interest rate review date. Year.
– Many people prefer long interest rates precisely because they bring stability and predictability to their finances in an uncertain interest rate environment. When the difference in interest rates for different types of interest was still large, this increased interest in lower interest rates. Now the difference between long and short interest rates is narrowing all the time, says Nurmi.
The housing market is somewhat quiet, which is reflected in housing financing as well. The OP says that they received about a quarter fewer mortgage applications in January-April than last year.
According to the bank, the number of transitions to a grace period or other payment schedule has not increased significantly.
“We also had a slight expectation that the number of repayment waivers would increase during the winter, but so far our customers have managed their mortgages well,” says Nurmi.
In January-April, OP’s customers took an additional 10 per cent higher loan cut than a year ago. The additional repayment amount has averaged around 500 Euros. Nurmi estimates that, if possible, the loans have been truncated well before the interest rate review date.
You can see the impact of interest on your loan costs with the calculator below.
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