The age of secure payday loan has come.
- The payday loan market has grown significantly, reaching HUF 128.5 billion in the first four months of the year, an increase of 58 percent.
- According to Rankyu, the majority of new payday loan, about 73 percent, have a fixed repayment period for more than one year.
- payday loan with a fixed repayment period of more than 1 year are more predictable than their variable rate counterparts.
- There are significant differences in the market: payday loan with a fixed repayment installment of HUF 1.5 million for 5 years can be more than HUF 10 thousand a month.
The payday loan market has been on a steep upward trend
For a long time, and this year has also started to expand. The popularity of payday loan can be explained, inter alia, by the fact that they have partly taken over the role of previously popular free-to-use mortgages. On the one hand, because interest rates on payday loan have dropped significantly, and on the other hand, they are much easier to apply for than mortgages, and borrowing costs are lower for payday loan because of no valuation, notarial deed or mortgage registration.
In the first four months of the year, banks signed new personal loan agreements worth HUF 12.8,5 billion, a 58% year-on-year increase. It is also important that in addition to the growth, the majority of payday loan with a fixed installment for more than 1 year providing a predictable repayment installment, according to BankRackyu latest compilation of official data. The amount of payday loan with fixed repayment installments for more than 1 year exceeded HUF 93 billion, thus they accounted for 73% of new loans. And the percentage of payday loan with a fixed installment of at least one year or up to 5 years was 27 percent.
Housing loans tendency market for payday loan
Madam XP, the Rankyu expert said. Valid “seen in housing loans tendency market for payday loan. That latter also providing predictable monthly installment fixed-rate loans are the majority of fixed-rate loans to the advantage of the period of fixation the same amount will be the installment. even if the interest rate environment changes in the meantime. Therefore, in the event of a potential interest rate increase, the installments on variable-rate payday loan may increase, but not on fixed-rate loans. ” He added that payday loan have a typical maturity of 3-5 years, so it is worth fixing the interest rate for the whole period, because only in this case can borrowers be sure.
BankRackyu analysis also shows that among the five-year fixed-term and 5-year $ 1.5 million payday loan, the cheapest ones can be applied for at the beginning of June, with a full APR of between 6 and 7 percent, It means. However, the thm of the most expensive constructions can exceed 20 percent, which means more than 40,000 forints per month. Due to the significant differences, according to Rankyu, it is worth looking at the offers of as many banks as this can save borrowers up to half a million forints.