Can a student earning a casual, half or quarter-time job afford a housing loan? It has only been a few years that more Polish families can afford a mortgage.
This was due to the decrease in market interest rates, which was followed by interest rates and loan installments. Today taking 300,000 USD loan for 30 years (it is already enough for a small apartment in a large city) for a monthly installment of USD loan needs to allocate 1.8 – 2 thousand. USD.
But where is the lower-income threshold from which you can start thinking about taking a mortgage? Is USD 500 enough, maybe 1,000? USD? And if so, what credit can you count on then?
We looked at the single that is only entering adulthood
There are no financial obligations on his head – he does not repay the loan, he has no credit card or car. There are also no staggering savings, which is why he is thinking about a loan without a down payment, or he is ready to make a symbolic contribution to the purchase of the real estate.
Lives in Warsaw. This is an important assumption because in the capital and the largest Polish cities the cost of living in the highest.
Of course, the banks take this into account, which may reduce the maximum loan amount compared to the applicant from a smaller town, where the so-called life must be spent less. We also assumed that our single is employed under an employment contract and wants to spread the loan repayment over 30 years.
A thousand is not enough
It is already 1 thous. USD net income can open the door to a mortgage? In most banks, such an applicant will be cleared successfully. In several institutions, however, he will get a loan, but with these earnings, it is enough to buy a medium-class used car rather than even for a very small studio apartment.
The most generous is Good Credit Bank, which is ready to withdraw up to 59,000. USD, i.e. for each dollar net salary gives 59 times more credit. On 50.5 thousand USD, we could count our single would grant a maximum of 42,000 USD, and With empty hands, only Bank E-Money would not leave our single, which in this case gives 23,000. USD, which is enough for 3-4 sq m. flats.
A student with three thousand will have a choice
We will raise your salary by another 1,000 dollars, i.e. up to 3,000 USD net. Admittedly, these are not the average earnings of a student making his first steps on the labor market. Let’s see how much mortgage a person would get without any other financial obligations. In four banks, the available loan will exceed 300,000. USD.
It is worth recalling that next week the new guidelines of the Polish Financial Supervision Authority regarding the relationship between earnings and the loan amount will come into force. Everyone who earns a net income below the national average, i.e. up to 2.2 thousand USD, will not be able to spend more than half of his earnings on all loan installments.
Those who earn above the average will be able to spend up to 65 percent on installments salary. The banks had 10 months to adapt their procedures to these guidelines. Most of them ensure that they have already adapted to change.