According to the initiative issued by the People's Bank of China to guide the market interest rate pricing self-discipline mechanism on the 29th, all commercial banks will uniformly implement batch adjustment of the interest rate of existing housing loans before October 31. In cities where the lower limit has been abolished, the interest rate of existing housing loans will be reduced to no less than the loan market quoted rate (LPR) minus 30 basis points. Let's see what happens to the interest rate of your housing loans. The first, second and above housing loans are adjusted under the guidance of the People's Bank of China. The interest rate self-discipline mechanism clearly proposes that the existing housing loans adjusted by commercial banks include the first, second and above housing loans, and the interest rate is reduced to not less than 30 basis points less than the LPR, and not less than the lower limit of the interest rate of newly issued commercial bank personal housing loans in the city (if any). The reporter learned from the People's Bank of China that by the end of July, the weighted average interest rate of all outstanding housing loans was about 4.06%. According to the current LPR estimate of more than 5 years, the adjusted average interest rate has decreased by about 0.5 percentage points compared to 4.06%. However, this is only an estimated average. Because each borrower's mortgage is issued in different regions and at different times, the reduction rate also varies. Especially for borrowers in Beijing, Shanghai, and Shenzhen, the extent of the reduction will be subject to the lower limit of the local new mortgage interest rate policy. Ms. Tao, who lives in Changning District, Shanghai, is quite concerned about the upcoming adjustment of the interest rate for her second home loan. In the previous round of adjustments to existing housing loans, due to the lower limit requirement of Shanghai's second home loan interest rate policy, her loan interest rate was lowered to 5.25%. According to Shanghai's regulations, after this batch adjustment, I can pay less than 900 yuan per month and less than 300000 yuan in 30 years Ms. Tao calculated an account for the reporter, and not only that, but if the LPR for a period of more than 5 years further decreases before February next year, she can also enjoy the benefits brought by the interest rate cut at that time. The reporter learned that currently, the lower limit of interest rates for newly issued first-time home loans in Beijing, Shanghai, and Shenzhen is lower than the LPR minus 30 basis points. Therefore, the interest rates for first-time existing home loans in these three places are also adjusted at the same rate as the national adjustment; However, the reduction of interest rates for two existing housing loans in three different regions varies. For example, the interest rates for two existing housing loans within the Fifth Ring Road in Beijing are adjusted to LPR minus 5 basis points, while those outside the Fifth Ring Road are adjusted to LPR minus 25 basis points; The interest rate for existing mortgage loans for second homes in Shenzhen has been adjusted to LPR minus 5 basis points. Pan Gongsheng, President of the People's Bank of China, previously said that the policy would benefit 50 million families and 150 million people, and reduce the total interest expenditure of families by about 150 billion yuan annually. The self regulatory mechanism for banks to proactively adjust and provide convenient interest rates to borrowers has been proposed. Major commercial banks, including the four major banks, will generally release operational rules no later than October 12th to respond promptly to customer concerns. The reporter learned from the interest rate self-discipline mechanism that commercial banks will complete the preliminary preparation work such as contract text changes and system upgrades as soon as possible to ensure the timely completion of the adjustment of existing housing loan interest rates. Banks are encouraged to provide online channels for "one click operation" to provide convenience for borrowers. The relevant person in charge of the People's Bank of China said that the vast majority of borrowers can complete "one click operation" through online banking, mobile banking and other channels without going to commercial bank outlets. Please pay attention to the relevant information released by the official platform of the lending commercial bank in a timely manner. The four major banks, Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, and Construction Bank, have issued a statement stating that they will resolutely implement relevant requirements and orderly promote the work of reducing the interest rates of existing commercial personal housing loans in accordance with the law. In terms of timing, the four major banks plan to release specific operational rules on October 12th, and implement batch adjustments to the interest rates of existing commercial personal housing loans before October 31st. The reporter learned from the relevant departments of ICBC that ICBC will clarify the scope of adjustment, adjustment rules, adjustment methods, time arrangements, service channels, etc., and will release the implementation rules and related matters through official websites, WeChat official account, outlets and other channels. The reporter learned that existing mortgage borrowers who previously adopted fixed interest rates now have a new opportunity to negotiate with banks and have them issue floating rate loans to replace existing fixed rate loans. Wen Bin, Chief Economist of China Minsheng Bank, stated that after the batch adjustment is completed, although the decrease in existing housing loan interest rates will reduce the bank's interest income by about 150 billion yuan, the narrowing of the interest rate spread between new and old housing loans will significantly reduce early repayment, which is conducive to stabilizing the bank's loan scale and improving loan quality. The People's Bank of China issued an announcement on the day when it agreed on the re pricing cycle to improve the interest rate pricing mechanism for commercial individual housing loans. The announcement clearly states that from November 1, 2024, when the deviation between the interest rates of floating rate commercial personal housing loans and newly issued commercial personal housing loans nationwide reaches a certain degree, borrowers can negotiate with banking and financial institutions to replace existing loans with newly issued floating rate commercial personal housing loans. The reporter learned from the People's Bank of China that this may be the last time for the bank to adjust the interest rate of stock housing loans in batches. In the future, the interest rate of stock housing loans will be dynamically adjusted through independent negotiation between the bank and the customer based on the principle of marketization. The announcement released this time further clarifies the relevant regulations and paves the way for banks to introduce relevant rules in the future. The People's Bank of China will also release the average interest rate of newly issued housing loans nationwide on a quarterly basis on its official website for reference by commercial banks and borrowers. According to previous regulations, the minimum repricing period for personal housing loan interest rates is one year. This time, the People's Bank of China proposed that from November 1, 2024, if the contract agreed to be a floating interest rate, the borrower meeting certain conditions could negotiate with the bank to agree on the margin of increase and the repricing cycle. The reporter learned that the repricing cycle can be annual, semi annual, quarterly, etc. Wen Bin stated that during the downward phase of interest rates, the shorter the repricing cycle, the earlier borrowers can enjoy low interest rates; But in the stage of rising interest rates, borrowers also need to bear high interest rates earlier. If the borrower wants to adjust the repricing cycle, they should make a cautious judgment. (New Society)