At the end of last year, the central bank issued a notice saying that in order to further deepen the LPR reform, commercial banks should formally switch the pricing benchmark of floating rate loans with existing loan customers 1 from March 2020. In principle, the switching of interest rate pricing benchmark for existing loans should be completed before August 3, 20201.
On August 25th, five state-owned banks, namely Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, China Construction Bank and Postal Savings Bank, began to convert individual housing loans with floating interest rates that meet the conversion conditions into LPR pricing in batches.
At the same time, many banks reminded that if you don't accept the batch conversion rules, you can contact the bank in advance or cancel after conversion. According to the announcements of various banks, after the batch conversion is completed, if there is any objection to the conversion result, it can be transferred back through mobile banking or negotiated with the loan handling bank before February 3, 2020.
For different stock mortgage customers, is it better to convert the interest rate of stock mortgage into floating interest rate or LPR plus fixed interest rate?
We think it mainly depends on factors such as loan balance, repayment period and repayment plan.
Recently, a number of commercial banks have issued announcements on the conversion of the pricing benchmark of personal loans with floating interest rates. For individual housing loans with floating interest rate that have been issued before 65438+1 October1in 2020 and have been signed but not yet issued (including commercial loans in portfolio loans, but excluding provident fund loans), the interest rate pricing mechanism can be converted into floating interest rate or fixed interest rate formed by adding LPR.
Among them, bonus value = current interest rate level of the original contract-2065438+LPR of the same period released in February 2009, and bonus value is fixed during the remaining term of the contract.
Generally speaking, converting the existing mortgage interest rate into a fixed interest rate can lock in the monthly repayment amount in the remaining repayment period in advance, which is mainly suitable for foreseeable and planned customers, and does not have to bear the risks brought by future LPR interest rate changes.
Converting into a floating interest rate with LPR plus points will not only have the opportunity to enjoy the reduction of monthly supply brought by LPR interest rate reduction in the future, but also bear the risk of increasing monthly supply brought by LPR interest rate increase in the future.
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In recent years, LPR is most popular with buyers with higher interest rates.
Xiaoqu, located in a third-tier city in Guizhou, tells us that since the beginning of this year, almost no one in their outlets has taken the initiative to request to convert to LPR, because for their local buyers, buying houses is basically self-occupied, with strong psychology of seeking stability and limited acceptance of LPR.
"In our case, both fixed interest rates and floating interest rates are almost fixed interest rates. For them, LPR has no concept at all. They just want to know how much money is fixed every month. You explain to him. On one hand, people don't understand. On the other hand, some people wonder if we are fooling them, because they have limited information and don't know about it. You tell them it may be cheap, and he will think you are lying.
Xiao Qu told us that the account manager faced great resistance in the early promotion process, and many times it was difficult for you to explain.
Zhu Jin is from Yangzhou, Jiangsu. He bought a house four years ago. Regarding the conversion of mortgage stock interest rate, he chose a fixed interest rate. He said that he didn't borrow much at that time, and the commercial loan was 4 1 10,000, which has been repaid for four years. When he bought it, he had a preferential interest rate, which was around 4.4 on the whole. He has calculated whether to change LPR or not, and decided that it was not cost-effective, so he did not change it.
K lives in Shanghai. He bought a house many years ago. Like Zhu Jin, he chose a fixed interest rate for different reasons. He used the repayment method of equal principal and interest, and paid most of the interest in the early stage. After the rules were changed, the impact on him was actually not great. "I don't have much interest, mostly the principal. This has nothing to do with me. "
It is understood that there are two repayment methods for buying a house with bank loans at present: one is equal principal and interest, and the other is average capital. If the customer has no special requirements, the general bank will choose the repayment method of equal principal and interest by default. The matching principal and interest will be less at first, and the interest will be higher in previous years, but the repayment amount will be the same throughout the repayment period.
Unlike several others, Longlong lives in Ningbo and is an advocate of LPR. He clearly quoted the current LPR quotation and knew that the latest quotation was lowered on April 20th. He said that he bought a house last year and was the beneficiary of LPR.
"I see can be changed directly. At first, I also had some worries. I weighed it and consulted relevant industries. Finally, after comprehensive analysis, I chose to change. Because I think LPR will continue to decline in the future, when I buy a house, the bank loan is actually quite strict. Then this year, the entire local auction market in Ningbo was on fire, and bank loans were relatively loose. I think the future real estate market should continue to prosper. Taking this opportunity, the New Deal should be good. "
According to the data of Rong 360, as of August 24, 2020, the city with the most favorable average mortgage interest rate in China is Shanghai, with an average discount of 9.5% and an average interest rate of 4.65%.
Mortgage interest rates in some cities in China
Since 20 19 and 12, with the downward movement of LPR interest rate, the national mortgage interest rate began to enter the downward channel. As early as the end of 20 18 to the beginning of 20 19, the average interest rate of the first home loan in China was still at a high level of 5.5-5.7%. Therefore, for buyers who buy houses with high mortgage interest rate, a large part of them support the floating interest rate formed by converting into LPR plus points.
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The expectation of future LPR interest rate fluctuation is the key.
In fact, for different stock mortgage customers, the interest rate of stock mortgage is converted into floating interest rate or fixed interest rate with LPR bonus, in which the expectation of future LPR interest rate fluctuation is the key.
If the LPR interest rate is considered to be on the rising channel for a long time, it will be more beneficial to convert the stock mortgage interest rate into a fixed interest rate; If the LPR interest rate is considered to be in the downward channel for a long time, it will be more beneficial to convert the stock mortgage interest rate into a floating interest rate with LPR points.
At present, many buyers who support the conversion of LPR bonus points into floating interest rates basically hold the attitude that LPR interest rates will further decline in the future.
This is mainly because since the implementation of the New Deal of LPR in August, 2065438+2009, the LPR over five years has been lowered three times, with the largest reduction of 10 basis point.
2019165438+1October 20th, the LPR over five years dropped by 5 basis points to 4.8% for the first time; On February 20, 2020, during the epidemic period, the five-year LPR decreased by 5 basis points to 4.75%. On April 20th, 2020, the LPR over five years dropped 10 basis point to 4.65%, the biggest drop since 20 19 years.
However, as of August 20th, 2020, the latest quotation of LPR has remained at 4.65% for more than five years, which is the fourth month since April 20th.
We believe that although the monetary policy is generally stable and positive in 2020, it should be linked to the central bank's financial work conference, maintain the continuity, stability and consistency of the real estate financial policy, and resolutely refrain from flooding. It is not difficult to see that the overall monetary policy will remain stable for some time to come.
In the long run, the current domestic interest rate level is at a relatively low historical level. Take the benchmark interest rate of 5-year loans as an example, it has remained at around 7% for 20 years, and it is still unknown how much room it will continue to be lowered from 4.65% in the future.
For most mortgages that have been frequently used for more than 65,438+00 years, buyers should still consider their loan balance, the discount level of the original loan interest rate, whether they have plans to repay in advance in the future, whether their future income will change, and whether it will affect their monthly payment ability.
(Xiaoqu, Zhu Jin, K and Long Long are all pseudonyms)