How much will lpr go down in 2023?

The Loan Market Quotation Rate (LPR) ended the consecutive months of "hold still" to welcome the first cut since last August. The following Xiao Biao brought 2023 LPR cut mortgage will be lowered is how much, we take a look at it, I hope to bring reference.

lpr downward mortgage will be lowered is how much?

The two key points of the mortgage rate with the lpr rate down are:

1, mortgage rate pricing using the lpr fluctuation rate in commercial lending, mortgage rate = lpr rate + plus a little bit of the number of lpr down to how much, mortgage rate can only be adjusted downward to the markup of lpr + plus a little bit of the number obtained.

2, lpr rate can be adjusted 12 times a year, on the 20th of each month upgrade, but the mortgage rate change cycle time is generally once a year, on January 1 of each year pricing again, the previous year in December upgraded and updated the same period lpr + plus a little bit of the number obtained. Therefore, the lpr downward adjustment, home loans will be adjusted downward, when the downward adjustment, downward adjustment is how much are all unknown quantities.

For example

Assuming that the principal of the housing loan is 200,000, borrowing for 20 years, equal principal repayment, the choice of lpr fluctuations in interest rate pricing, plus a little bit of the number of 0.1% fixed will not change the annual housing loan in 2022 the implementation of the interest rate is 4.75%, the re-pricing of the number of January 1 of each year, then:

1, if the December 2022 20 upgraded and updated 5-year limit above lpr interest rate is 4.3%, then January 1, 2023 after the repricing, a full year a new housing loan effective interest rate = 4.3% + 0.1% = 4.4%, housing loan interest rate down by 0.35%.

2, 2022 housing loan interest rate of 4.75%, monthly payment = 1292.45 yuan, while the implementation of the new interest rate of 4.4% in 2023, monthly payment = 1254.53 yuan, housing loan monthly payment fell 37.92 yuan.

Is it feasible to pay off your mortgage early with lower interest rates?

If you want to save interest on your loan, then it is appropriate to pay off your loan early even if interest rates go down.

The reason is:

1, the interest rate downward decline in mortgage interest rates, far less than the early repayment of loans to save interest, and early repayment of loans the faster the length of time, the greater the interest savings.

For example:

500,000 loan principal and interest loan 30 years, equal principal repayment, mortgage interest rates from 4.85% down to 4.75%, which down 0.1% can reduce the total loan interest is only 10,000, but if you pay back the loan early 20 years can save a total of more than 200,000 yuan of annual interest.

2, LPR rates down, mortgage rates can not be immediately down, generally a year to change.

For example:

Mortgage rates are priced again on January 1 of each year, with reference to the LPR rate that was upgraded and updated in December of last year, plus a little bit more, to get a new pricing, which does not change for the following year.

This means, in other words, that no matter how much the LPR rate goes down during the year, mortgage rates don't follow the shift, and are only regulated on the repricing date. If the LPR rate goes up early in the reconciliation, then the mortgage rate will increase with it, and it's quite possible that the interest rate on the non-excluded loan will be more than it was before.

What are the changes in home loans by opting for the new LPR?

Based on a 1 million yuan home loan, equal principal and interest repayment for 30 years, more than 5 years LPR every 10 basis points, the monthly payment is reduced by roughly 60 yuan.April 5 more than the LPR from 10 basis points to 4.65%, the monthly salary from 5,216.47 yuan to 5,156 yuan.37 yuan, the cumulative interest rate difference of 2.16 million yuan.

The reporter learned from many banks in Beijing, Beijing's first commercial personal housing loan interest rate is not lower than the corresponding period LPR. that is, the first personal housing loan interest rate floor is 4.75% is 0.55% = 5.3%, more than 5 years LPR reduced by 10 basis points after the housing loan interest rate is 5.

The LPR is that the LPR is published on the 20th of each month The LPR is published on the 20th of every month, but the corresponding LPR is not adjusted on a monthly basis and the pricing cycle is usually 1 year. As most banks stipulate that the repricing date is January 1 each year, for converted housing loans, the most recent reference LPR should be the LPR above 5 years published in December 2020.

Reporters' calculations show that the LPR above December 5 this year is still 4.65%, and that home buyers purchasing a new residence, using the new LPR housing loan interest rate (without taking into account the rate's anchor status), 1 million yuan housing loan equal principal repayment for 30 years, 2021 monthly housing loan repayment amount of 5491 yuan .

To date, the 5-year LPR is 4.75%, the first suite in Beijing to implement the interest rate of 5.3% (4.75% 5 basis points), the monthly housing loan repayments of 5,553 yuan, so the implementation of the new LPR interest rate, the housing loan is reduced by 62 yuan per month.

Based on the current benchmark interest rates of major banks in Beijing rose by 10%, or 5%.39% interest rate comparison (not taking into account the homebuyer interest rate increases or discounts), the implementation of a fixed interest rate after the implementation of the monthly payoff of 5609 yuan. This calculates that a new home buyer implementing the latest LPR would save $118 per month compared to a home buyer choosing a fixed rate (no rise or discount).

Central Plains real estate chief analyst Zhang Dawei believes that real estate on the one hand, adhere to not speculate on the one hand, but must be stabilized, lower interest rates will help to maintain real estate expectations stable.

LPR cut million mortgage 30 years will be 21,000 yuan less

9:15 pm, the People's Bank of China authorized the National Interbank Offered Rate Center announced that the loan market quotation rate (LPR) on June 20, 2023: 1-year LPR is 3.55%, down 10 basis points, more than 5 years LPR is 4.2%, also down 10 basis points. It was previously 4.3 percent.

In early June, state-owned banks and a number of national joint-stock banks cut deposit listing rates, including 2-year deposits down 10bp, 3-year and 5-year 15bp. then the policy interest rate "rate cuts" to open, June 13, as a short-term policy interest rate of the open market operation 7-day reverse repurchase rate The LPR of more than 5 years related to personal residential mortgage loans will be reduced, and the home loan family will have the opportunity to enjoy the policy "big red packet".

If the commercial loan amount of 1 million yuan, loan 30 years, equal principal and interest repayment method, the LPR fell 10 basis points, the monthly payment reduced by 58.54 yuan, the cumulative 30-year monthly payment reduced by 21,000 yuan.

However, this does not mean that mortgage holders will necessarily save money. For homebuyers who previously gave up switching to LPR and opted for a fixed rate, the mortgage rate has nothing to do with the LPR adjustment, and the mortgage won't change; for inventory customers who have switched to LPR pricing rates, they need to take the repricing cycle and repricing date into account, and their monthly payments will remain unchanged until the repricing date.

Specifically, most banks are adjusted from the first month of the new year, assuming that the repricing cycle agreed between the homebuyer and the bank is 1 year, the repricing date of January 1 each year, this month's 5-year LPR downward adjustment will not affect the amount of its mortgage repayment each month this year, January 2024, many people's mortgage will usher in a new round of adjustments to the cycle.

Currently, the national unified first set of housing commercial personal housing loan interest rate floor is 4.1%, after this 5-year LPR cut 10BP, the unified mortgage interest rate floor is expected to break through the 4% mark.

How does the LPR cut affect home loans?

The latest news published on the official website of the Central Bank at 9:30 p.m. showed that the People's Bank of China allowed the National Interbank Offered Rate Center, April 20, 2020 Loan Market Quotation Rate (LPR) for 1 year LPR 3.85%, more than 5 years LPR 4.65%. The above LPRs are valid until the next LPR release. Next, JIT will explain how the LPR cuts will affect home loans

Compared with the March LPR data, the 1-year LPR was 4.05% and the 5+ year LPR was 4.75%. The current double-dip drop in the 1-year and 5+ year LPRs, by 20 bps and 10 bps, respectively, is the biggest drop since August last year.

According to market analysis, this LPR rate decline further reflects the directionality of the decline in 5-year or medium- and long-term loans, which plays a positive role in reducing the cost of, among other things, housing loans.

One-year LPR breaks 4

The reporter collated and found that since the LPR reform in August last year, so far, the one-year LPR has fallen by 35 basis points, and the five-year LPR fell by 20 basis points.

This LPR offer is in line with market expectations. In order to guide the decline of the lending rate, the central bank has previously made sufficient padding in the determination of the price. After the central bank's reverse repurchase operation rate fell by 20 basis points on the 7th of late March, the winning rate of the new phase of the MLF operation carried out by the central bank on the morning of April 15 also fell by 20 basis points.

According to the previous rule, it was a regular practice for the central bank to conduct MLF operations in the middle of the month, booking the operation window in order to guide the LPR offer. Reverse repo-MLF-LPR became the standard operation mode for the central bank to guide down the cost of financing.

From the overseas market, there have been many countries' central banks releasing water, compared with China's monetary policy to maintain the strength of the LPR rate remained unchanged in March.

But in the face of the global shock of the epidemic, China's monetary policy has stepped up its counter-cyclical adjustment. Since the beginning of this year, the central bank has utilized quantitative monetary policy tools such as lowering standards, refinancing and rediscounting, and MLF to encourage financial institutions to increase their support for the real economy while maintaining a reasonable abundance of liquidity.