Original title: The central bank cuts interest rates and your mortgage remains unchanged?
Source: Tonight News
The People’s Bank of China recently issued an announcement to reduce the one-year medium-term lending facility and the seven-day open market operation interest rates by 10 basis points on January 17. People from the central bank have publicly stated that the LPR (loan market quoted rate) will fully reflect the changes in market interest rates in a timely manner, guide the decline of corporate loan interest rates, and effectively promote the reduction of corporate comprehensive financing costs. The industry reminds enterprises and residents to pay attention that the LPR is expected to be lowered from today, which will bring changes to people’s work and life.
A number of bankers in the city pointed out that in the current macro environment, the central bank’s interest rate cut is in line with market expectations. The central bank continues to release the effectiveness of the LPR reform, which will help to reduce the actual loan interest rate of enterprises.
According to people from securities research institutions, this rate cut is not only good for the stock and securities market, but also conducive to the “combination punch” of monetary policy and tax and fee reduction policies. Since the end of last year, the āred envelope effectā of taxation has been prominent: on the basis of the extension of tax exemption for small and medium-sized enterprises, some preferential personal income tax policies have been extended, including the extension of the policy of one-off bonuses to be taxed separately on a monthly basis until the end of 2023, and the extension of listed companies. Policies such as the extension of the separate taxation policy for equity incentives to the end of 2022 will help support the upgrading of the manufacturing industry and benefit many small, medium and micro enterprises, individual industrial and commercial households, and the majority of wage earners.
In addition, people from the city’s real estate research institutions also reminded that interest rate cuts are good for people who buy houses with loans. According to the regulations of the central bank, the lender and the lending bank can negotiate and choose the interest rate re-pricing (usually the shortest period is 1 year). Each time the interest rate is re-priced, the pricing benchmark is adjusted to the LPR of the corresponding term in the latest month. If the 5-year LPR quoted today is lowered, it will help reduce the monthly mortgage payment burden of citizens who are ready to take out a loan to buy a house. However, it should be noted that many people who have taken out loans to buy a house have a one-year mortgage re-pricing cycle, and their mortgage interest rate re-pricing date is January 1 every year, and the mortgage interest rate of the year will be adjusted according to the LPR at that time. Since the 5-year LPR quotation in December 2021 has not changed, this means that even if the 5-year LPR in January 2022 is lowered, their mortgage interest rates will not change this year.
The customer service staff of some large banks in the city also reminded that at the current stage of epidemic prevention and control, citizens are not advised to go to the branch to consult and handle business in the near future. If citizens want to inquire about personal loan history details, they can choose special services such as the bank’s “cloud bill” and place an order through mobile banking.
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Responsible editor: Jiang Xiaotong