An employee counts Vietnamese banknotes at a bank in Hanoi. Photo by VnExpress/Giang Huy
Borrowers find it difficult to obtain new loans to pay off their debts because the cost of obtaining a new loan can be just as high as paying the interest on the old one.
The State Bank of Vietnam (SBV) this month began allowing home and car buyers to get a new loan to pay off their existing debt, and several banks have started offering this type of loan to individuals , which was previously only accessible to individuals. businesses.
Nguyen Minh Ha, who owes VND1 billion ($41,200) on a property in Long An province, contacted state-owned bank BIDV for a loan, but discovered that the bank values his property at less than that of the current private bank to which he owes.
This means that if he got a new loan, he would have to pay a 3% prepayment fee to the current bank, plus an insurance fee of VND6 million for the new loan from the new bank, and the new loan will be repaid. be lower than the current one.
Another customer, who asked to remain anonymous, said she will have to pay several fees to get a new loan and when combined she found they provided no cost advantage over the payment of interest on the loan. old loan.
“The process of acquiring the new loan would take a long time.”
So far, three state-owned banks Vietcombank, BIDV and VietinBank, as well as private lenders MB and Techcombank, offer this type of loan.
A branch manager of a state-owned bank said that over the past two weeks, no new such loans have been issued by his bank, because the value of a new property is often lower than the previous one in a tough market, which means customers only get a smaller loan.
The amount of paperwork a bank must complete for each individual loan is significant but the credit amount is not attractive enough, he added.