Housing loans demand may drop

Demand for housing loans grew even although the criteria were tightened. In the opinion of those polled, the increase in that demand might have been caused by the buoyant forecast for the housing market, the improvement in household wealth and several other factors, for example, the better state of the country's economy.

The tougher lending policies will be continued in the fourth quarter of 2019, although the demand for housing loans will likely drop, according to the NBP. However, the NBP points out that predictions regarding demand for housing credit have relatively low accuracy.

In terms of consumer loans for households, banks tightened their criteria, and, slightly, the conditions for granting them. The decision was motivated, most notably, by the increase in the share of non-performing loans in consumer credit, an increased risk related to housing deposits, and the worsening of the bank’s current and predicted capital situation.

As the NBP noted, no bank was able to explain why they decided to ease their credit policy.

In the fourth quarter of this year, banks predict even higher increases, tightening their credit policies, and the further growth in demand for consumer loans.

The NBP stressed in its report that the criteria for granting loans are understood as the minimum creditworthiness standards set by the bank that the borrower must meet to be granted a loan. On the other hand, the conditions for granting loans are the features of a loan agreement agreed between the bank and the borrower, including the interest margin, non-interest loan costs, the maximum loan amount, the required collateral and the maximum loan period.