Loan takers all across the Eurozone are dreading the decision expected to be taken by the European Central Bank on Thursday for an unprecedented jumbo 75 basis point lift to interest rates.
In Cyprus, thousands are the loan takers who have already expressed concern over the imminent move which is to make the already heavy burden of soaring inflation even worse, Philenews reports.
After all, they are still in shock over the July 21 decision by the ECB Governing Council to raise the three key ECB interest rates by 50 basis points, it added.
But what does the jumbo 75 basis point lift to interest rates mean? And how much will the instalments increase every month?
Philenews gives some examples so that bank clients that have loans with a variable interest rate get an idea:
Before July 21, the average mortgage interest rate for an amount of €200,000 was 2.4% and for repayment, in 20 years the loan instalment was 1,040.
After the July 21 decision, the average market rate increased to 2.9% and the instalment rose to €1,099.
In the scenario that the floating rate increases by 0.75% o Thursday, the instalment will go as high as €1,175.