Interest rates on existing loans hit the highest level in more than 10 years. This is why banks’ lower interest rates on loans only apply to new borrowers, but it is a different story to existing borrowers. Both credit loans and home mortgage loans (main mortgage) interest rates of existing borrowers are rising without knowing how to break.
According to the Bank of Korea’s economic statistics system on the 20th, interest rates based on balances at domestic deposit banks continue to rise. The balance-based interest rate is the interest rate applicable to existing borrowers. As of March, the unsecured loan interest rate was 6.38%, the highest since November 2013 (6.39%). The interest rate on the deposit was also 4.12%, the highest since September 2013 (4.13%).
Both loan rates have never fallen since they hit their lowest point in May 2021 and started rising until March of this year. In the meantime, unsecured loans rose by 3.17 percentage points (3.22% → 6.39%), and credit loans rose by 1.48 percentage points 카지노사이트(2.64% → 4.12%).
The atmosphere is quite different from the rapid decline in interest rates for new loans applied to those who borrow new money from banks. The interest rate on unsecured loans based on new loans peaked at 7.97% in December last year and fell to 6.44% in March this year. The interest rate on Judamdae also rose to 4.82% in October last year and then fell to 4.40%.
As the interest rates of existing borrowers continue to rise, the atmosphere of not feeling a drop in interest rates is still the same. An official from a commercial bank said, “For new borrowers, compared to the beginning of this year, if you get loan counseling now, the interest rate will have definitely dropped. “The size of existing loans is much larger than the amount of new loans, so most of the people will still think that interest rates are rising,” he said.
Rising delinquency rates are also largely affected by rising interest rates for existing borrowers. According to the Financial Supervisory Service, as of February, the delinquency rate for credit loans was 0.64% and the delinquency rate for mortgage loans was 0.20%. Compared to a year ago, they jumped by 0.27 percentage points and 0.09 percentage points, respectively.
Although the Financial Services Commission and the Financial Supervisory Service are pressuring banks to lower their lending rates, the limits are clear. This is because banks cut interest rates only for new borrowers. This is why even the insiders of the banks say that it is condescending. In order to give interest rate cut benefits to existing borrowers, it is necessary to touch the additional interest rate, which is not easy for banks. Since new loans are not as active as in the past, the interest rate reduction effect is not expected to be significant.
An official from the financial sector said, “In order to expect a proper interest rate cut effect, a policy that includes not only new borrowers but also existing borrowers must come out, but no bank has ever done that.” Considering the downtrend in the fix, interest rates for existing borrowers are expected to turn down during the second half of this year,” he said. do