The interest rates was raised this week a by a lot and it is in this light the information from The Ministry of Finance in Poland (below) must be seen and there will maybe come more help according to rumours.
The Ministry of Finance in Poland writes that they would like to remind people in Poland about the possibility of obtaining support from the Borrowers Support Fund (FWK).
People repaying loans that find themselves in a difficult financial situation can count on up to 2000 PLN of support per month for a period of 3 years.
What is the Borrowers Support Fund?
The Borrowers Support Fund (FWK) is a mechanism that provides assistance to borrowers who find themselves in a difficult financial situation and are required to repay housing loan instalments.
FWK solutions are also addressed to borrowers who sold the real estate to be credited and the amount obtained from the sale did not cover the entire liability under the housing loan (promise or loan for debt repayment).
How does the Borrowers Support Fund work?
The FWK consists of contributions from lenders. The support is paid for a period not longer than 36 months, and the individually determined amount of support cannot exceed 2,000 PLN per month. It is transferred by Bank Gospodarstwa Krajowego to the borrower’s bank that granted the housing loan.
Who can apply for support?
Support or a loan for debt repayment may be granted if one of the following conditions occurs:
- on the day the application is submitted, at least one of the borrowers has the status of an unemployed person;
- The borrower bears monthly costs of servicing the housing loan in the amount exceeding 50%. monthly income of his household;
- his / her monthly household income, reduced by the monthly costs of servicing a housing loan, does not exceed:
- in the case of a single-person household – twice the amount indexed in accordance with the provisions of the Act on social assistance, specified in Art. 8 sec. 1 point 1 of this Act (from January 1, 2022, twice the amount of 776.00 PLN – 1.552.00 PLN );
- in the case of a multi-person household – the product of twice the amount indicated in art. 8 sec. 1 point 2 of the Act on Social Assistance, indexed in accordance with the provisions of this Act and the number of household members (from January 1, 2022, twice the amount of 600.00 PLN – 1,200.00 PLNper person).
In order to obtain support, a promise or loan to pay off debt, the borrower should apply to the lender.
The repayment of the support or loan begins 2 years after the payment of the last instalment of the support or loan. The support is repaid in 144 equal and interest-free instalments. If the borrower repays 100 instalments without delay, the remaining instalments of the support or debt repayment loan will be cancelled.
Restrictions on getting support
Support and debt repayment loans may not be granted:
- if the loss of employment by at least one of the borrowers was his fault;
- if one of the borrowers obtained support under the terms of the Act (if the support is no longer granted and the period of its granting did not exceed 35 months, the total period of support granted to borrowers for the repayment of a housing loan may not exceed 36 months);
- if the housing loan agreement has been terminated before submitting the application for support or a loan for debt repayment;
- for the period in which at least one of the borrowers is entitled to unemployment benefit under the concluded loan repayment insurance agreement, guaranteeing the payment of the benefit in the event of unemployment.
If, on the day of submitting the application:
- the lender owns or has owned another flat or house in the last 6 months;
- the lender has a cooperative right to a flat or a single-family house in a housing cooperative or has had such a right in the last 6 months;
- the lender has a claim for the transfer of ownership of a flat, single-family house, cooperative right to a flat or single-family house in a housing association, or has had such a claim in the last 6 months.
The borrower shall immediately inform the lender of:
- sale of the subject of the loan;
- increasing the monthly income or lowering the monthly instalment, leading to failure to meet the premise concerning the monthly costs of servicing a housing loan;
- taking enforcement actions against the subject of the loan;
- loss of the unemployed status;
- increasing the monthly income or reducing the number of members of the borrower’s household, leading to failure to meet the condition resulting from the monthly income of a multi-person household.
Example 1 (instalment to income ratio)
If the housing loan instalment is 2,500 PLN , and the borrower meets one of the conditions for receiving support from FWK (e.g. the ratio of the borrower’s expenses related to servicing the monthly housing loan instalment to the borrower’s monthly household income – over 50%), then the borrower may submit application for support. The amount of support will be determined individually, based on the provisions of the loan agreement.
Assuming that the maximum amount of support is set – 2,000 PLN , then for 36 months the FWK will transfer 2,000 PLN to the account indicated by the lender. The borrower will pay extra 500 PLN.
In this case, the support for the borrower will amount to 72,000 PLN. The reimbursement of this amount will take place two years after the payment of the last instalment of support by the CEF. The borrower has 144 monthly instalments of 500 PLN to be repaid. If he repays the first 100 instalments without delay (repayment of 50,000 PLN), the remaining 44 instalments (22,000 PLN ) will be cancelled.
Example 2 (income criterion)
Support may also be granted after verification of the income criteria and the amounts of cash benefits from social assistance – they are also a premise for receiving support from the CEF.
The amount in the calculation below is the current amount of income that entitles you to receive social assistance benefits and results from the Act on Social Assistance.
In the case of a multi-person household, if the monthly household income, reduced by the monthly housing loan servicing costs, does not exceed the product of twice the amount of 600 PLN and the number of household members, e.g. the amount of 3,600 PLN (600 x 2×3) for a family of three, the borrower meets the income criterion and can apply for support. The amount of support is determined and its return is performed in the same way as in example 1.
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Source: PAP Media Room