SOFT consumer loans for newlyweds will likely attract much attention but bankers do not expect them to significantly accelerate the overall growth of consumer loans.
“We do not assume that the launch of consumer loans designed for newlywed couples will radically speed up expected growth of all consumer loans,” said Robert Prega, a senior analyst at Tatra Banka.
VÚB Banka spokesperson Alena Walterová said that young families will likely use these reduced interest loans to furnish their homes. She said that she expected the product to be a success, similar to mortgages designed for young people.
“Nonetheless, it cannot be expected that their portion of all consumer loans could reach a similar volume as in the case of soft mortgages to young people, which make up 38 percent of all newly-provided mortgages at present,” she said, as quoted by SITA.
UniCredit Bank analyst Dávid Dereník believes that newlyweds will make use of these loans during the economic crisis, while lower prices of real estate will also motivate them. In his view bonuses like this should be some kind of motivation, taking into account people’s life cycle.
Newlyweds will be able to apply for soft loans from April 2010. The reduced interest rate on the loans will be 4.5 percent less than the commercial rate. The state will cover 3 percent of the interest and commercial banks will be obliged to reduce the interest rate by an additional 1.5 percent when the loan is provided.
The law sets relatively strict income criteria for applicants to qualify for these loans. The combined gross income of a couple may not exceed 2.6 times the average nominal wage reported by the Slovak Statistics Office and the couple must be younger than 35 to qualify.
11. Jan 2010 at 0:00 | Compiled by Spectator staff