news

Sun Chen, reporter of Chao News Client

"The interest rate on my second home loan has been adjusted! Now it will be calculated based on the first one!" Wang Qiang (pseudonym) recently received a text message notification from the bank: Dear customer, starting from July 26, 2024, the implementation rate for personal housing loans will be adjusted from LPR+65 basis points to LPR+0 basis points.

In 2021, Wang Qiang bought a small school district house on Baochu Road, Xihu District. Because he already had a large first house in Gongshu District, according to the interest rate policy at the time, the interest rate for his second school district house was 4.6%.

"At that time, it was a combination of provident fund and commercial loans, each of which was 1 million yuan. If calculated based on the current adjusted interest rate of 3.95%, I can pay nearly 400 yuan less each month." Wang Qiang said that although this amount is not much, it is nearly 5,000 yuan per year, which is a considerable amount after 30 years. "Now everyone has to live a tight life, and every bit of savings counts."

"It is mainly because of Hangzhou's new policy that I can enjoy this benefit. According to the current LPR floating adjustment, my loan interest rate will reach 3.85% in April next year," Wang Qiang added.

Image source: Visual China

Unlike Wang Qiang, Luo Xin (pseudonym) already has two properties in the same district. Her current first home loan interest rate is not as low as Wang Qiang's, but she does not meet the condition of "only one property in different districts is considered the first home loan", so she cannot adjust it.

In September last year, the central bank issued a new policy. From September 25, 2023, borrowers of existing commercial personal housing loans for their first homes can apply to the lending financial institution for the financial institution to issue a new loan to replace the existing commercial personal housing loans for their first homes, or negotiate to change the interest rate level agreed in the contract.

This year's "May 9" new policy clearly states that if a buyer has only one house in the city where the house is purchased and it is currently listed for sale, when applying for a mortgage loan for a newly purchased house, it can be recognized as the first house and enjoy the first interest rate. In addition, with the complete abolition of purchase restrictions, the four central urban areas (West Lake, Gongshu, Shangcheng, Binjiang) and other urban areas will no longer recognize the number of houses, that is, buying a house in different urban areas can be considered the first house.

After combining the two factors, Wang Qiang became the lucky one who benefited from the adjustment of interest rates on existing houses.

Image source: Visual China

"Indeed, there have been many such cases where the second set of housing was converted into the first set and the first set of housing interest rate was enjoyed." A relevant person in charge of the housing credit department of a large state-owned bank introduced, "The process is very simple, that is, find the loan manager of your bank, then apply, then go to Zhejiang Liban or Alipay to check the file, provide it to the loan manager, and go to the bank to fill out the change materials. Generally, there are no other problems. You can receive the adjustment notice one week after submitting the application."

It should be noted that the interest rates of existing mortgage customers cannot be reduced accordingly at present. In Wang Qiang's case, the second mortgage was changed to the first mortgage under the current policy. As for existing mortgages, there is currently no policy to reduce the interest rates in domestic cities such as Hangzhou.

Like Wang Qiang, if you meet the conditions, you can indeed apply for a reduction in the interest rate for your second home loan, which was applied for at the peak of the market in 2021. However, some existing mortgage loans have been uniformly reduced last year to 4% or 4.2% because they meet the new first-home recognition conditions.