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Swiss Francs Mortgages in Poland


Harry
19 Jan 2015 #31
Since I dont like the location

You can't not like the location: the location you give doesn't exist.
Good luck to anybody who wants to get a mortgage, CHF or otherwise, for a property on a street which doesn't exist.
pigsy 7 | 305
19 Jan 2015 #32
You can't not like the location: the location you give doesn't exist.

shows how brilliant you are to read the ad from a known portal ha ha ha.
weeg
19 Jan 2015 #33
who gets harmed? i want to see if you actually know the answer to this.

The opposite party, obviously.

what part of that do you not understand?

The bit where they were paying far less than a loan in local currency. Swings and roundabouts
shaman
19 Jan 2015 #34
WB quote:
So, if you could afford it and went ahead and did it would you expect no sympathy from your fellow man.

Exactly. But as a start I wouldn't do it. Everyone knew it was risky. Currancies change, simple as that.

WB quote:
He is and you would be, just a person playing the Monopoly game of life along with the rules they provided.

He played the game, tried to be smart and lost. That's life. And that's the price of free choice.

As I said- I have a symphaty for the man as a human being but not as a victim of the situation because he's not a victim. He wasn't forced into it, he chose it.
jon357 63 | 15,309
19 Jan 2015 #35
Yes, swings and roundabouts.

The Financial Times a couple of years ago called the Poland/CHF mortgage situation an act of collective insanity. It's always a risk taking out credit in a currency you don't earn (I earn in USD, have a credit card and in GBP but spend PLN and invest/bank in both) so I'm aware of the risk and have gained/lost at various times, but a mortgage on your (the bank's?) home in the currency of a far richer country, just to get a lower %???

It was pure speculation; hugely risky and like many risky investments, it went tits up.

I sympathise with those who lost, but ultimately it was a big risk that they knowingly took.
Wroclaw Boy
19 Jan 2015 #36
but a mortgage on your (the bank's?) home in the currency of a far richer country, just to get a lower %???

Easy for you to say now Jon. At the time Polish property was experiencing massive gains in short periods of time, people just wanted mortgages, they never envisioned themselves in negative equity and being lumbered 5 years on. A few % savings on the interest rate on a short term investment made perfect sense. Theres a very good reason as to why 95% all Polish loans were in CHF for that time period.

but ultimately it was a big risk that they knowingly took.

I disagree with that, most of these people were small time investors, amateurs looking to try and get ahead. They didn't have a clue.

And that's the price of free choice.

All i see here is aggressive capitalism.
jon357 63 | 15,309
19 Jan 2015 #37
In saying they didn't have a clue, the banks are really to blame for seductive advertising. For myself, I've always been over cautious with credit (never had a loan or mortgage, only recently got a credit card) and didn't go for it - though it was tempting for a while. Now it reminds me of Black Monday back in 1991ish when people in my office who were already overstretched for credit were crying at their desks because it looked like they could no longer pay their mortgages/loans and eat as well.

I know a guy, decent but naive, noticeably lower than average intelligence, a fairly badly paid unskilled job who was given credit to buy a new-build flat in Mokotow (and riskily kept on his old flat, also mortgaged) both in Swiss Francs. As I say, I sympathise with ordinary people who were taken for a ride by banks. If somebody had asked at the time what his views were on the CHF being tied to the Euro, he wouldn't have understood the question.

For better informed people who just hoped to get rich from a buy to let flat or live in a posh one that needed a mortgage higher than they could really afford and who were aware of possible currency fluctuations, I have less sympathy - it was basically speculation.
weeg
19 Jan 2015 #38
the banks are really to blame for seductive advertising. For myself, I've always been over cautious with credit (never had a loan or mortgage, only recently got a credit card) and didn't go for it - though it was tempting for a while.

Please, are you being serious? Other people are seduced by advertising but nothing persuaded you?
f stop 25 | 2,513
20 Jan 2015 #39
Shouldn't the banks take the hit and convert the loans from swiss-franc to PLN like Hungary did? Or Rumania is planning to do?
And why do Polish banks even offer loans in foreign currencies? Or did those borrowers go to Swiss banks?
cms 9 | 1,271
20 Jan 2015 #40
Doing that would make a lot of them bankrupt and either close or leave Poland.

So you could do that but if you ever wanted to borrow money in the future you would not have many places to go.
jon357 63 | 15,309
20 Jan 2015 #41
Shouldn't the banks take the hit and convert the loans from swiss-franc to PLN like Hungary did? Or Rumania is planning to do?

Too many in Poland - the foreign currency mortgage bubble was on a much higher scale than in Hungary or Rumania.

And why do Polish banks even offer loans in foreign currencies?

Easy to sell to the gullible and/or the greedy at first, then thy became so popular that ordinary folks (who'd grown up with hyperibflation, didn't trust the zloty that much, had always known a rising housing market and were interested in finance and investment) got taken in by the lower interest rates as well.
bullfrog 6 | 603
20 Jan 2015 #42
Fully agree with Jon. Nevertheless, since most of the time people don't understand the risk they are taking and only see the "get rich quick" side of things, i think an outright ban on FX mortgages should have been put in place in Poland (like is the case here in Turkey), with possible exceptions for people who could demonstrate FX earnings.
InWroclaw 89 | 1,915
20 Jan 2015 #43
Yes, and they aren't selling at those prices, which is why you keep seeing them. I was wondering whether prices are going to take another dive, but then I remembered that Poles generally loath lowering the price they want for something and loath it so much that they prefer not to sell than to drop their price.

Indeed! Seems that way almost always.
Just got a mailing from one of the portals, and I see a place that I offered on maybe a year ago is still for sale but now at 1.5% off !! :D A few developers have posters up saying 'nowy cena!' but from memory the prices are the same or very similar, so far. All around they're building new flats, all over the place. Some are nice, some are ghastly slave boxes. Quite a few houses being built here and there as well as refurbs. Had a look at the prices yesterday and don't really see any bargains.
weeg
20 Jan 2015 #44
an outright ban on FX mortgages should have been put in place in Poland

Basically that is the case now. Hindsight tells us foreign currency loans are a bad idea. Just as it tells us the Swiss couldn't sustain the Peg - almost nobody expected it at the time.

the foreign currency mortgage bubble was on a much higher scale than in Hungary or Rumania.

It's quite the opposite, Poland is the least affected.

For better informed people who just hoped to get rich from a buy to let flat or live in a posh one that needed a mortgage higher than they could really afford and who were aware of possible currency fluctuations, I have less sympathy - it was basically speculation.

I can't see the difference between being informed or not, someone trying to make a quick buck through speculation is entitled to and fully responsible. The law agrees, stupid people can take out loans and buy houses .. and make money on it.
weeg
20 Jan 2015 #45
Croatia is helping it's CHF borrowers. Poland could afford to if it wants.
jon357 63 | 15,309
20 Jan 2015 #46
Not a hope - the amounts involved are too large and it's in any case very much in Poland's favour to have a weak zloty.
Swiss guy
20 Jan 2015 #47
Croatia is helping it's CHF borrowers. Poland could afford to if it wants.

Any proof that Croatia is helping its CHF borrowers?
jon357 63 | 15,309
20 Jan 2015 #48
They're freezing the exchange rate however this is risky in itself and only a very temporary thing.
wbj.pl/croatia-to-aid-its-franc-borrowers
cold outsude
20 Jan 2015 #49
Any proof that Croatia is helping its CHF borrowers?

There was a ruling by the Croatian high court in favour of Croat borrowers in 2013.

blogs.wsj.com emergingeurope tag swiss-franc

I can't see the difference between being informed or not, someone trying to make a quick buck through speculation is entitled to and fully responsible. The law agrees, stupid people can take out loans and buy houses .. and make money on it.

The law states certain investments are for sophisticated investors ONLY. First-time buyers in Poland are mostly not sophisticated investors,
The only way for any Swiss franc borrower to receive any form of recourse will be under the mis selling of PRIPS act by the EU.
Wiki Polonica
20 Jan 2015 #50
How is it possible that the Polish legislator and financial supervisory committee considered this situation in accordance with the law that banks could lend polish zloty, but could write in the lending agreement the equivalent amount of the money in francs . Banks gave to creditors only polish zloty , francs were the only means by which banks determined the credit repayment installments.

No one received the loan in Swiss francs, the banks did not have those francs in their own deposits . Today no credit is available in francs when it costs almost 5 zł , but when it was for 2 zł it was widely offered .

This means it was a widespread scam known to all banking managing staff.
They manipulated the huge number of people in such credits and the government did not do anything to stop that scam. In 2007-2008, there was a conspiracy to find as many franc creditors as possible . It was a conspiracy to fix credits in polish złoty on very high interest to discourage people from credits in zloty .

This type of scam credit was de facto a credit in polish zloty, but on the paper it was said that the amount was such and such in francs . In a normal country this would be unthinkable.

They gave credit in zloty but they demand the repayment in francs . If someone says it was or is legal call him cretin . Those Polish banks should pay huge penalties for large scale scams .

But our regulators are mostly corrupted by banks , that`s the sad truth .
In USA , UK it is a different world . Regulators fined six major banks a total of $4.3 billion (2.73 billion pounds) for failing to stop traders from trying to manipulate the foreign exchange market, following a yearlong global investigation.

HSBC Holdings Plc (HSBA.L), Royal Bank of Scotland Group Plc (RBS.L), JPMorgan Chase & Co (JPM.N), Citigroup Inc (C.N), UBS AG UBSN.VX and Bank of America Corp (BAC.N) all faced penalties resulting from the inquiry, which has put the largely unregulated $5-trillion-a-day market on a tighter leash. .

This is the biggest financial scandal ever .
Wroclaw Boy
21 Jan 2015 #51
Today no credit is available in francs when it costs almost 5 zł , but when it was for 2 zł it was widely offered .
This means it was a widespread scam known to all banking managing staff.

right, its all about profit....and screw everybody else.

This is the biggest financial scandal ever .

There have been bigger. How the Federal Reserve came to being is probably one of the worst.

But our regulators are mostly corrupted by banks , that`s the sad truth .

The entire planet is corrupted by money...thats the truth and why wouldn't it be considering how everybody needs it in a free market social system.
weeg
21 Jan 2015 #52
Polish Banks to be forced into pain sharing plan. It's on bloomberg.
Xanathos
23 Jan 2015 #53
Hi,
Can you please tell me how much is the interest rate for swiss franc mortgages in Poland (LIBOR + x)? I want to compare it to the one I pay in Romania.

Thanks!
Monitor 14 | 1,820
23 Jan 2015 #54
I think it's around 0.8% - 1.6% above LIBOR. Now some of banks don't want to agree for negative interests rates and national regulator is intervening. I think margins are so low, because at the beginning banks were earning also on spreads. You could exchange PLN to CHF only in your bank, but later national regulator ordered them to accept CHF directly so that finished.
Xanathos
23 Jan 2015 #55
Whaaaa... less than 2%? Is that true? I have 5.8% + LIBOR. It seems Romania is a gold mine (for some).
bullfrog 6 | 603
24 Jan 2015 #56
i am paying 0.70% for my CHF mortgage
gosc112
24 Jan 2015 #57
I really hope these people with CHF mortgages don't get any state help. They drove prices up with their currency gambling and now we should have a natural correction as they are forced to sell or get repossessed. Why should other tax payers subsidise their reckless gambling?
Monitor 14 | 1,820
24 Jan 2015 #58
I really hope these people with CHF mortgages don't get any state help. They drove prices up with their currency gambling and now we should have a natural correction as they are forced to sell or get repossessed. Why should other tax payers subsidise their reckless gambling?

They shouldn't get any help, because it's their gamble, but they where generally good for the economy. The money which they borrowed abroad increased GDP growth, increased salaries in construction sector, increased houses prices, what gave bigger incentive for companies to build more. The question is how competitive is construction market. If it is competitive then higher prices should lead to more apartments constructed, but if not, then just to increased earning of construction companies on the market.

Mortgages are generally good, because it is the cheapest debt, increase home ownership and in many cases is alternative to renting. Of course everything depends on conditions.
jon357 63 | 15,309
16 Mar 2015 #59
They gave credit in zloty but they demand the repayment in francs

Nobody ever "demanded" that a mortgage customer chose credit with repayments in Swiss Francs - CHF motgages were something one had to consciously choose over a more sensible mortgage in a currency one actually earns.

If someone says it was or is legal call him cretin

Call some of the country's best lawyers cretins then.

As long as no public asistance is given to people who took out credit for buy to let investments or on luxury properties, while others in society are homeless or overcrowded then all is fine.
pigsy 7 | 305
17 Mar 2015 #60
Cant all those stuck with francs refinance in Poland in pln???


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