Are you planning to buy your first apartment? The good news is that there is a home loan subsidy program that can help you achieve this dream. In this article, we will discuss in detail the terms and conditions of this program, the amount of the loan, how the installment subsidies work, and the benefits and limitations of a secure 2% loan. We will also present alternatives to this program so you can make an informed choice. Keep reading to learn more!
See also: Safe Credit 2 percent – what you should know before the program launches
Who can benefit from the home loan subsidy program?
To qualify for the 2 percent safe loan, a person must meet certain criteria. First of all, he or she must be under the age of 45 and not own any apartment, house or cooperative right to a unit or house. If a person is married or the parent of at least one joint child, the age condition must be met by at least one of these people.
The housing loan subsidy program is primarily aimed at young people who want to buy their first apartment. This is an excellent opportunity for those who dream of owning their own place, but have difficulty raising the necessary funds. Thanks to this program, they can obtain a mortgage on preferential terms, which will make it much easier for them to realize this dream.
What loan amount can be obtained under the subsidy program?
The home loan subsidy program allows you to get a loan with a maximum amount, which depends on the group to which the borrower belongs. A single person can get a loan of up to PLN 500,000, while a married couple or parents with a child can apply for a loan with a maximum amount of PLN 600,000.
It is worth noting that the housing loan subsidy program covers both primary market housing, i.e. new apartments from developers, and secondary market housing, i.e. used apartments that are available on the secondary market. As a result, people using the program have more choice and can find the right apartment for them regardless of whether they prefer new or used properties.
2% loan in Warsaw – free assistance in obtaining financing
How does the housing loan installment subsidy work?
A home loan installment subsidy is a favorable solution that helps borrowers pay off their mortgage. It consists of the difference between the fixed interest rate set by lending banks based on the average interest rate on fixed rate loans, and the interest rate on the loan according to the 2% rate. The subsidy is provided for a period of 10 years and reduces the amount of the installment, making it much easier to repay the loan.
To better understand how the home loan installment subsidy works, let’s look at an example. Let’s assume that a married couple with one child took a loan for a period of 30 years for the amount of 550 thousand zlotys. The interest rate on the loan is 8.46%, but after taking into account the 10% surcharge (that is, 7.61%), the installment is reduced. In the first year of repayment, the difference between the installment without the subsidy and the installment with the subsidy is almost PLN 2.6 thousand. The installment without the subsidy will be about PLN 5.4 thousand, while the installment with the subsidy will be about PLN 2.8 thousand. After 10 years, borrowers will repay the loan as a fixed principal and interest installment, which amounts to PLN 3,172.74 per month.
How do mortgage installments change over a period of 10 years?
The principal and interest installments of the mortgage will decrease over a period of 10 years. This is because at the beginning of the loan repayment, a larger portion of the installment goes towards interest and a smaller portion goes towards principal repayment. However, over time, as the principal is successively paid off, the interest decreases, resulting in a smaller installment.
Let’s look at an example for the first installment and for installments after 10 years. Let’s assume that a married couple with one child took a loan of PLN 550,000 for a period of 30 years. At the beginning of the loan, the installment without the subsidy is about PLN 5.4 thousand, while the installment with the subsidy is about PLN 2.8 thousand. After 10 years, when there is a switch to the so-called annuitet (fixed principal and interest installment), the monthly installment is PLN 3,172.74.
What are the benefits and limitations of the 2% safe loan program?
The 2% safe loan program offers many benefits to those who take advantage of the program. One of the main benefits is the possibility of obtaining a preferential mortgage for the purchase of a first apartment. Thanks to this program, people who do not yet own their own home can fulfill their dream of owning their own apartment. In addition, thanks to the housing loan installment subsidy, repayment of the loan becomes easier and more affordable. The difference between the fixed interest rate set by the banks and the 2% rate is covered by the Government Housing Fund for a period of 10 years.
However, it should be noted that the 2% safe loan program also has some limitations. One of them is the age limit – the person applying for this loan must be a maximum of 45 years old. In addition, in order to be eligible for the program, a person must not own any apartment, house or cooperative housing rights. The program covers both primary and secondary market housing, so there is no price limit per square meter of housing. These restrictions are designed to ensure that the program goes to those who are most in need of support in buying their first apartment.
What are the alternatives to the secure 2% loan?
There are other options for financing the purchase of a first apartment that can be alternatives to the secure 2% loan. One of them is a mortgage offered by traditional banks. The interest rate on such a loan can vary and depends on the customer’s individual circumstances and the market situation. However, it is worth remembering that the interest rate on a mortgage offered by banks can be higher than that of a 2% secured loan.
Another alternative may be to take advantage of support programs for young people, which help finance the purchase of a first apartment. An example of such a program is Housing for the Young, which offers preferential loan terms and subsidized loan installments. Interest rates under this program are lower than for traditional mortgages, making it much easier to repay the debt.