We have prepared a series of recordings for you.
We want you to come to the meeting with an outline in your head of the area we are going to cover. You will find on our platform videos that address the most important, fundamental issues of taking out a mortgage. Some of them relate more to you when it comes to, for example, the issue of creditworthiness itself, some of them develop other threads, less universal, but they should also be exhausted at the very beginning. We want you to have a certain foundation when coming to the meeting so that it is as productive as possible for you – we respect your time. We invite you to watch and possibly ask questions already at the meeting.
Bank Margins
Bank margins are a significant part of the mortgage interest rate. This is essentially the profit that the bank aims to make on the loan they provide. Here’s what you need to know about bank margins:
- Fixed vs. Variable Margins – some banks offer fixed margins, meaning the margin remains the same throughout the loan term. Others offer variable margins that can change based on market conditions or your credit profile.
- Risk – the bank adds a risk bonus to the interest rate based on creditworthiness, employment stability and other risk factors. Higher perceived risk results in a higher margin.
Reference Rates
Reference rates, also known as base rates, are another crucial element in determining mortgage interest rates. In Poland, the most common reference rates are the WIBOR (Warsaw Interbank Offered Rate) for loans in PLN, and EURIBOR (Euro Interbank Offered Rate) for loans in EUR. Here’s how they work:
- WIBOR – this is the rate at which banks lend to each other in the Polish market. It fluctuates based on supply and demand for funds and is influenced by monetary policy and economic conditions.
- EURIBOR – this rate applies to loans denominated in euros and is influenced by the European Central Bank’s monetary policy and broader economic conditions in the Eurozone.
- Impact on Mortgages – your mortgage interest rate is often expressed as the reference rate plus the bank’s margin. For example, if the WIBOR is 1.5% and the bank’s margin is 2%, your mortgage interest rate will be 3.5%.
The Economy in Poland
The broader economic context in Poland also plays a significant role in shaping mortgage interest rates. Here’s how various economic factors come into play:
- Inflation – higher inflation typically leads to higher interest rates as the central bank raises rates to control inflation. Conversely, lower inflation can result in lower interest rates.
- Monetary Policy – the National Bank of Poland (NBP) sets the base interest rates for the economy. Changes in the NBP’s policy rates directly influence the reference rates like WIBOR.
- Economic Growth – strong economic growth can lead to higher interest rates as demand for credit increases and the central bank acts to prevent the economy from overheating. In contrast, slower growth or a recession can lead to lower interest rates as the central bank aims to stimulate borrowing and investment.
- International Influences: Global economic conditions and policies of major central banks (like the ECB and the Federal Reserve) can also impact Polish interest rates, particularly if there are significant movements in global interest rates or economic trends.
Why you should consult your situation with our experts?
Every financial situation is unique, which is why an individual approach to choosing a mortgage loan is so important. Our assumptions are only a simulation, and your conditions may differ. That’s why we encourage you to contact our experts who will:
- Analyze your individual financial situation
- Find the best loan offers available on the market
- Help negotiate with the bank
- Provide support at every stage of the loan process
By working with us, you can be sure that the selected mortgage loan will be perfectly tailored to your financial situation and future plans.
Contact Us
Consult your situation with our Experts. Take advantage of our knowledge and 16 years of experience to make the best financial decision. Remember, working with us is completely free of charge!
Call us on +48 12 352 12 12 or fill out the contact form on contact page to schedule a free consultation. We are here to help you!