Saturday, April 10, 2021
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Home Breaking News Mortgage rates began to rise in Russia

Mortgage rates began to rise in Russia

Russian banks have begun to raise rates on mortgage loans, the Izvestia newspaper reports with reference to the financial marketplace and data from a number of top 50 credit institutions.

In particular, interest on a home loan and a refinancing program rose in four regional banks. Since April, the conditions for the mortgage are being prepared to be revised at Zenit and MTS Bank.

However, experts interviewed by the publication state that there will be no sharp changes in the conditions for issuing housing loans.

First of all, experts believe, the adjustment of the preferential mortgage program will affect the average rates on such loans. By the end of 2021, its size may exceed 8%.

We will also remind, on the eve it became known that in Russia from April 1, the recommendation of the Central Bank not to collect mortgaged apartments from debtors, if this is their only housing, ceases to be effective. Also, you will no longer be able to take a mortgage vacation.

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Stanislav Danilov, partner of the Pen & Paper Bar Association, told RIA Novosti about the innovations. According to him, we are talking about a unified law on consumer loans. Back in 2019, this law was amended to allow borrowers in a difficult situation to get mortgage holidays, and last year’s “coronavirus package” only developed the provisions of the document.

Danilov noted that initially a difficult life situation was defined as loss of work, disability, temporary disability for more than two months (this includes COVID-19), as well as a decrease in wages by 30% or more. At the same time, the Central Bank’s recommendation was not to foreclose on the pledged object if this is the debtor’s only housing.

All these measures are canceled from April 1. This means that those who did not manage to apply for debt restructuring will no longer be able to apply for it. Also, from April, banks will be able to fully insist on the usual performance of obligations by borrowers.

Danilov stressed that the economic situation in the country is far from being favorable, and progress in the fight against covid does not mean that citizens’ incomes have recovered to the dock level. That is, those whose incomes fell and did not recover will hardly be able to fulfill their loan obligations in the amount declared in previous periods without prejudice to their families. The lawyer believes that countermeasures are needed to prevent such a collapse.



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