Those who borrowed in francs in 2006 to buy homes are better off now

Those who chose to borrow in Swiss francs to buy a home in 2006-2007 paid less in lei than if they had taken out a euro-denominated loan, thanks to the lower interest rates, despite the franc/leu exchange rate rising faster than the euro/leu rate.
Considering the options available for a 60,000-euro loan (which would have meant 95,500 Swiss francs at the exchange rate valid for the end of 2006, over 30 years, even amid similar interest rate terms, the balance is tipped in favour of the franc-denominated loan.

Therefore, considering a fixed nominal interest rate of 5.5% a year in the first year, and then calculated based on reference indicators on the financial markets - six-month Libor for franc-denominated loans and six-month Euribor for euro-denominated loans - plus a 4.5% margin, the instalments on a franc-denominated loan would have totalled 98,700 lei until now (the conversion was made at the exchange rate of the NBR (National Bank of Romania) valid for the last day of every month). In the case of euro-denominated loans, the overall value of instalments slightly exceeds the equivalent of 100,000 lei.

"In most cases, the overall cost of a Swiss franc-denominated loan taken out between 2006 and 2007 is still lower than the overall cost of a similar loan taken out in euros," says Anca Bidian, CEO of Kiwi Finance, the biggest credit broker on the Romanian market.