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Office of Competition and Consumer Protection

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Mortgages and rising interest rates

< previous | next > 06.05.2022

Mortgages and rising interest rates
  • Consumer, if you have a mortgage and have the means, you can overpay.
  • On the website you will find a calculator using which you can calculate how your instalments or the amount of interest will change after the overpayment.
  • Ongoing loan repayments are a burden? See what your options are.

"With WIBOR interest rates used for mortgages on the rise, repayment of instalments may be an increasing burden for some people. Significant relief may be provided by a number of support tools guaranteed by Polish legislation. They may be particularly important for those groups of mortgage takers for whom mortgage instalments are a serious burden on the household budget," says Tomasz Chróstny, President of UOKiK.

You have a mortgage and the instalments are a burden to you? See what tools you can use:

Statutory repayment holidays – the current solutions, adopted as a result of UOKiK's initiative under the so-called "Covid acts", are still in force. If you have not used them yet with regard to a mortgage, and you have just lost your job or main source of income – you can suspend the loan repayment for up to three months, and the bank will not charge you any additional interest or other costs. Similarly, you can take out one consumer loan.

How can you do that? Submit an application to the bank – use the form on the website The bank will suspend the execution of the agreement from the moment of receipt of the application. If you had insurance associated with your loan, the bank will inform you of the premium you will pay. The term of the loan, as well as all deadlines stipulated in the loan agreement, will be extended by the suspension period. Read about the details in the UOKiK announcement.

At the same time, Prime Minister Mateusz Morawiecki's proposed solutions for the new formula of repayment holidays aim to increase their availability and reduce the burden on borrowers even further. Let us remember that a statutory repayment holiday is financially more advantageous for the consumer than a bank credit memorandum.

Loan overpayment – early repayment of all or part of the loan will enable you to reduce the amount of the instalment or shorten the term of the loan, as both the outstanding amount and the interest on it are reduced. Note that this is a more beneficial decision for your finances than the interest earned on your deposits or term deposits in that time. This means that overpaying a loan can give you more benefits than many investments, including a bank deposit. For loan agreements concluded after July 22, 2017 with a variable interest rate, the bank may charge a fee within three years of its incurring. The amount of this fee and the possibility of its collection are specified in the Act on mortgage loan. 

Remember: if you repay part or all of your loan early and the repayment period is shortened – the bank must give you back a proportionate part of the charges that make up the total cost of the loan. This proportional reduction should correspond to a reduction of the repayment period and be calculated on a straight-line basis.

We've put together a financial calculator with which you can check how the amount of your loan instalment will change when interest rates go up. You will also be able to see whether it would be more beneficial for you to reduce the instalment or shorten the term of the loan if you overpay. You can find the calculator at

Financial cushion – if you don't have any funds to repay the entire loan before the deadline, set aside some money as a so-called financial cushion to secure future repayments of higher instalments in case of unexpected circumstances, e.g. job loss or an even higher increase in interest rates. If you can, limit your consumption at least minimally, so that you can build up financial security and set aside some savings for unforeseen events in the future in small, regular steps.

Swap or sell your home – you may want to consider selling or swapping your property and living in a smaller or cheaper flat in another location. This will significantly reduce your financial burden, in particular by overpaying or repaying your existing loan with the money difference you get thanks to the change. If you have the opportunity, for example you live in a popular location, you can also rent out your flat for a period of time (all of it or one room).

Changing to a fixed interest rate. You can negotiate with the bank. According to the offers available on the market, the fixed interest rate is valid for a certain period – usually 5 years – and in the agreement the bank can reserve the right to charge you if you overpay the loan during this time. When interest rates are rising, the periodic fixed interest rates offered by the banks are usually higher than the current WIBOR 3M or 6M reference rates, but you are then guaranteed that your instalment amount will not change over the next few years. However, before you sign an annex to your agreement, carefully review the wording, do your maths and consider whether moving to a fixed rate will be worthwhile for you – interest rates that are currently rising can both rise and fall in the future. With a fixed interest rate on the loan, the instalments will remain as agreed.

Negotiating the margin. Mortgage margins have changed significantly over the years and it is possible that you have a loan with a relatively high margin (e.g. over 2.5 percent). You can negotiate the amount with the bank, for example, if you have paid off part of your debt and the price of the property has increased. This reduces the LTV ratio, i.e. the ratio of the debt to the value of the flat, so the margin would be lower under current conditions. You can try to change your loan to a cheaper one at another bank – the difference in margins will lower your loan instalments. Such a change will be valid for the entire term of the loan. Remember that changing banks may require collecting many documents, involve additional costs (e.g. notary fees, agency fees or costs resulting from early repayment in the original bank).

Borrowers' Support Fund. It provides financial assistance to borrowers in a difficult situation: you can apply for a repayable loan for debt repayment in the following cases: when the instalment amounts to half of the borrowers' disposable income or when the household income after deducting the instalment is less than PLN 1,200 per person (and for a one-person household it is less than PLN 1,552) or when you have lost your job. The support is granted for a maximum period of 3 years and is paid out in monthly tranches equal to the loan instalments, up to PLN 2,000 per month. This loan is repaid in 144 interest-free instalments, part of which, i.e. 44 instalments, can be remitted if the remaining 100 instalments are repaid on time. Detailed conditions under which such support can be obtained can be found in the Act or on the website of Bank Gospodarstwa Krajowego. To benefit from the Fund's assistance, submit an application to your bank.

Repayment holidays offered by banks. In addition to the statutory solution mentioned at the beginning (statutory repayment holidays), some banks also offer the possibility of temporarily suspending the repayment of the loan on their contractual terms. This is not a free tool – check the cost of such a solution carefully. Most often it involves extending the term of the loan or increasing the amount of the next loan instalment. Ultimately, the cost of the loan will be higher.

Extending the term of the loan repayment. You can apply for it at your bank. This will reduce your current instalment, but will also increase the total cost of the loan as you will be paying interest over a longer period. Bear in mind that with high interest rates and a longer remaining loan term, such as twenty-five years or more, you should not expect a significant drop in your instalment amount due to the extended repayment period. If the bank agrees, such a change to the agreement will involve signing an annex, which may also be subject to a fee. Check this in the table of fees and commissions and ask the bank for an accurate simulation of the instalment change before making a decision.

Consumer support:

Phone: 801 440 220 or 22 290 89 16 – consumer helpline
 Email: [SCODE]cG9yYWR5QGRsYWtvbnN1bWVudG93LnBs[ECODE]
Financial Ombudsman – if a complaint is rejected by a financial institution
Consumer Ombudsmen – in your town or district

Additional information for the media:

UOKiK Press Office
Pl. Powstańców Warszawy 1, 00-950 Warszawa, Poland
Phone +48 695 902 088, +48 22 55 60 246
E-mail: [SCODE]Yml1cm9wcmFzb3dlQHVva2lrLmdvdi5wbA==[ECODE]
Twitter: @UOKiKgovPL

Attached files


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