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Monday, December 11, 2023

Credit holidays for longer? Project assumptions

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Will credit holidays be extended? According to the Chancellery of the Prime Minister, the government has prepared a draft law extending credit holidays until 2024. The project assumptions proposed the introduction of an income criterion as well as restrictions related to the loan amount.

“It is proposed that the suspension of repayment on the terms applicable in 2023 would also be possible in 2024. However, in relation to the applicable regulations, it is proposed to introduce a limitation on the list of persons entitled to benefit from the suspension of loan repayment. According to the project, such right will be available to borrowers who the amount of the capital of the loan granted was not higher than PLN 400,000. This amount was determined on the basis of data from the Polish Financial Supervision Authority as corresponding to the average amount of a mortgage loan granted for the purchase of an apartment, subject to suspension under the previously applicable regulations,” it was written.

It was added that if the capital amount of the loan granted is higher than PLN 400,000 but not higher than PLN 800,000, suspension of the loan repayment will also be possible.

“In such a case, it will be available to a borrower whose ratio of expenses related to servicing the monthly principal and interest installment of the loan to the average monthly income of his household exceeds 50 percent.” – added.

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The Act on crowdfunding for business ventures and assistance to borrowers entered into force at the end of July 2022. It introduced the so-called credit holidaysi.e. the possibility of suspending the repayment of housing loan installments in PLN for four months in 2022 and four months in 2023.

Credit holidays are available to people who repay a mortgage loan taken out for their own housing needs in Polish currency before July 1, 2022. In its current form there are none income criteria.

Credit holidays for longer?

Prime Minister in September Mateusz Morawiecki announced that the loan holidays will be extended for the entire next year, but the income criterion will be applied. As he pointed out, the Polish Financial Supervision Authority is working to determine the income threshold for credit holidays.

According to Bartosz Turek, chief analyst at HRE Investment Trust, the current government may not be able to move legislative process by the Sejm, Senate and president. Moreover, the new government and the new coalition may not agree to this proposal.

– Considering the politicians’ statements and declarations so far, I expect that the credit holidays will not be extended. I cannot imagine a majority that would support this demand, Turek said.

Election results

National Electoral Commission on Tuesday it published data from 100 percent of voting precincts. According to them, PiS won 35.38 percent of the votes, Civic Coalition – 30.70 percent, Third Road – 14.40 percent, New Left – 8.61 percent, and Confederation – 7.16 percent of the votes.

PiS won 194 seats in the Sejm elections, KO – 157; Third Road – 65; New Left – 26; Confederation – 18. This means that the democratic opposition wins 248 seats in the Sejm. The parliamentary majority is 231 seats.

SEE ALSO: Election results 2023. Who won the parliamentary elections to the Sejm and Senate

Main photo source: Shutterstock

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