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Italians asking for a mortgage or loan rose to 34.6% in 2016

by Enrico Netti

The number of Italians that asked for a mortgage or loan rose in 2016, a study by credit information agency Crif showed. “The Credit Map in Italy in the year 2016” report showed a renewed inclination to take out financing last year, which involved 34.6% of the adult population at the end of the year, an increase of 1.8% compared to 2015.

In terms of geographical distribution, the region with the greatest number of people with active loans was Tuscany, where the share was more than 40%, followed by Friuli-Venezia Giulia, Sardinia and other regions in northern Italy. At the opposite end of the rankings was the wealthy Trentino- Alto Adige, where less than one out of six adults is making use of financing. It comes below Basilicata with 28.4%, Molise with 29.3%, and the other southern Italian regions.

The rankings for level of indebtedness are quite different: in three regions of northern Italy (Lombardy, Trentino-Alto Adige and Emilia Romagna) the average is more than €40,000 due to the greater weighting of mortgages, against a national average close to €34,500, a figure that also includes the portion of mortgages and subrogation loans. The situation is quite different for the south of Italy, where there is greater recourse to loans to buy electronic and consumer goods and big domestic appliances, furniture, cars and motorbikes.

In Calabria in southern Italy, the average indebtedness is half that of Lombardy in the North, and in each of the eight southern regions, the average is not more than €30,000. All in all, each of the almost 21 million adults that has at least one loan contract has to reimburse a rate of about €360 at the end of the month.

“The divide between the North and the South can be explained with the different habits of managing debt,” said Beatrice Rubini, director of Crif’s Mister Credit line. “In northern Italy, for example, the share of mortgages is greater while in the South there is a greater tendency to stay in the family house, and in the case of purchasing a house, to draw on family savings.”

At the national level, the most used form of financing is purpose loans, which make up 43.3% of the total, with a decline of three tenths of a point compared to 2015. These loans are linked to the purchase of consumer or durable goods, for leisure time and for health. Personal loans represent another third of contracts while real estate credit makes up a 23% share, an increase of 3.1% compared to the previous figures.

“The economic scenario is improving progressively while the rates applied are close to historic lows,” said Rubini. “These conditions determine a greater inclination to ask for mortgages to buy a house and loans to renew durable and costly goods.”

This cycle making it easier for Italians to access credit seems to be continuing in 2017. In February, requests for loans rose 1.2% while the average value jumped 7.9%, coming close to €9,400. This figure indirectly confirms that there is a return of confidence among Italians seeing as the €9,000 threshold had not been surpassed since March 2011.