Heiki Raadik, the head of credit products with Luminor, says that although in crisis situations banks routinely review their terms and conditions for issuing loans, there have been no major changes in that regard so far this year. Home loans continue to be issued, the number of applications for which has grown since mid-May.

“The overall volume of home loans that we’ve issued has dropped off because of the coronavirus crisis, but the market hasn’t come to a standstill,” he said. “People are still applying for loans, and they’re still being issued. Provided they have a good credit rating, clients are still able to find good offers even in the current situation, which is reflected in the interest rate on the loans that have been issued over the last few months – it’s the lowest it’s been at any point in the last decade.”

Raadik says that the availability and general terms and conditions of home loans have remained relatively stable over the years, and that if clients are creditworthy and at little risk of a reduction in income, then loans continue to be issued to them on pre-crisis conditions. As a rule, home loans are issued for up to 30 years, with a downpayment requirement ranging from 15-20% – although this can be lowered to 10% with a Kredex guarantee, or even to zero with additional collateral.

Statistics from the Bank of Estonia show that the volume of loans issued by banks in May was 80 million euros, compared to the previous 110 million euros. “The number of home loans being issued by May dropped off by almost a third, but we’re already seeing some encouraging signs,” Raadik said. “The volume of applications and the volume of loans being issued have both started to recover.”

In Raadik’s view it is never a bad time to buy a home. “If your credit history speaks in your favour, you’ve got the money for the downpayment you need and you’re sure you want to buy, it’s definitely worth looking into the options that are open to you,” he said.