Lowest Interest Rates for Loans, It’s Time to Settle Down

Interest rates for loans are currently at their lowest level in 20 years, accompanied by a range of favorable lending policies from banks. This is creating an opportunity for potential homebuyers to invest or own their dream homes. The real estate market is gradually heating up as a result.



During the final days of the year, many commercial banks have launched low-interest credit packages to stimulate credit demand. Notably, interest rates for loans have hit rock bottom. The leaders of the Central Bank have stated that the current interest rates for new deposits and borrowings at banks are at their lowest levels in the last 20 years.

Sharing at a recent press conference on the implementation of the banking sector tasks in 2024, Mr. Pham Chi Quang, Head of the Policy Department of the State Bank of Vietnam, said that the latest statistics show that the average deposit interest rate at banks is currently only 3.9% per year. The average interest rate for new transactions is 6.7% per year, a decrease of more than 2 percentage points compared to the year-end figures for 2022.

In the middle of 2023, many people refrained from taking out loans to buy houses or apartments due to concerns that the preferential interest rates in the early period would be adjusted upwards after the preferential period ended. The market context has changed at the present time. Some economists believe that deposit interest rates will be difficult to decrease further because they have hit rock bottom, while lending interest rates will be kept stable to support customers and promote economic growth.

The results of a survey on the business trends of credit institutions, conducted by the State Bank of Vietnam, which has just been released, show that the average deposit and lending interest rates can only decrease slightly. The expected average decrease in the first quarter of 2024 is 0.3-0.4 percentage points.

At the same time, the real estate market is showing positive signals.

The National Assembly of Vietnam has recently passed amendments to the Housing Law, the Real Estate Business Law, and the Land Law at the fifth extraordinary session in January 2024. These amendments will contribute to the development of the market in a more transparent, healthy, and sustainable direction. Experts from VNDIRECT Securities Company believe that these laws will help solve the existing legal bottlenecks, provide stricter regulations on the requirements for investors, and protect the rights of homebuyers. The amended Real Estate Business Law imposes higher requirements on investors and protects the rights of homebuyers.

Banks are implementing a series of preferential solutions to support homebuyers. Therefore, this is the best time to borrow credit to buy a house, as it provides an opportunity to access the lowest interest rates in the last 20 years.

For example, at the International Bank (VIB), the mortgage loan package being implemented offers attractive interest rates ranging from 6.5% to 7% per year, meeting diverse financing needs of customers, from borrowing to purchase houses, apartments, to construction, renovation loans or loans to settle outstanding loans from other banks. Customers can borrow up to 90% of their capital needs, up to VND 100 billion. The maximum loan term is 360 months. The fixed interest rate term is flexible for up to 36 months.

VIB representative stated: “VIB always listens to and cares about customers’ needs in order to provide tailored solutions, along with competitive and flexible interest rate packages to accompany VIB’s customers throughout their wealth-building journey“.

For customers concerned about their finances in the early stage, the bank is offering a grace period of not repaying the principal in the first 24 months. For customers planning to repay their loans in the short term, VIB provides a free early redemption interest rate package after 6 months. For customers with existing loans from other credit institutions, VIB supports a 0% interest rate for the first month and 6.5% from the following month when repaying their loans early and transferring their mortgage loan to VIB. Additionally, from now until the end of February 29, 2024, customers have the opportunity to access a 0% interest rate package in the first 12 months when borrowing to purchase mortgaged properties at VIB.

Economic expert, Mr. Dinh The Hien, analyzed that during the period from 2019-2022, despite some hot periods in the real estate market, the prices of apartments in many projects that have been put into operation have not increased significantly. Some apartment projects have increased, but at a reasonable level compared to income and the land segment. In the coming time, the prices of apartments in this apartment project segment will also be difficult to decrease further, and the demand will always be there.

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