An increasing number of Belgians are finding it difficult to make monthly repayments on their home loan. At the end of 2012, the total amount of overdue mortgage loans had risen to 971 million, representing an increase of 10.8% compared to a year earlier. According to Perry Neets, the head of the Central Office for Credits to Individuals, part of the National Bank, this is a record. The number of overdue contracts has increased to 30,509, which means there is also an increase of 5% there.
Difficulties get bigger
According to Neets, it is especially noticeable that consumers who already had problems face larger problems. It is mainly the longer-term loans that are difficult to repay. If it is already difficult with payments, it appears to be difficult to resolve this and then start releasing on the home loan. Instead, the repayments are skipped to make money available elsewhere.
Backlogs on consumer credit
Moreover, it seems that the difficult economic situation is by no means the only culprit, but that many consumers also choose to take out expensive consumer credit. In general, Belgians relatively easily incur debts, for example when they want to buy a new television or a car. In general, the problem payers not only have a home loan, but there are also a few other loans that provide for financial obligations. In order to be able to repay on the home loan, it is important that no other loans are present that demand a significant part of the income. By looking carefully at the possibility of taking out an extra loan, it is possible to prevent such problems.
The banks are a lot stricter and more careful nowadays when it comes to granting loans. This is annoying on the one hand when you need a loan, but on the other hand it makes it less easy for people to borrow. The problems with new home loans have diminished considerably in the last two years, as situations are less likely to arise in which consumers can no longer pay off the debt or the interest rate rises above them. However, according to the Professional Association of Credit (BVK), the problems are not so bad, since the number of defaulters has been around 1.1% for years. Mortgage interest rates are also at a historically low level, which means that consumers pay relatively little interest.