Estimates per million, but actually two? How not to get bogged down in debt by paying for sudden repair surprises

Debt repairs are a double-edged sword: borrowed funds are justified when you need to change rotten pipes, but easily turn into bondage for the sake of a premium kitchen. How to find a middle ground and not to go broke, told in an interview with “MK in St. Petersburg” leading researcher of the Center for Banking Consulting and Applied Research of the Financial University under the Government of the Russian Federation Kyrlan Marchel.

According to the expert, a loan cannot be considered a bad or good solution. It depends on the goal. If you need to replace emergency wiring, leaky pipes or windows, borrowed money can become a rational tool. In this case, a person compares the cost of a loan with the risk of flooding neighbors or being left without electricity. It is quite another matter - decorative repairs. If the work can be put off and saved up for them, a loan will make routine repairs too expensive a treat.

Now the Bank of Russia’s key rate is 14%, so consumer loans remain expensive. The expert advises to look not at the advertising rate, but at the full cost of the loan (PUK), which takes into account all interest and mandatory expenses.

It is important to correctly calculate your strength. A safe level is a situation when all loans take no more than 30-35% of a stable family income. And you need to count not from the maximum earnings in a successful month, but from the amount that exactly comes every month. For example, if a family earns 150 thousand rubles and already pays 25 thousand on other loans, taking another 40-50,000 for repairs is too risky. Formally, the bank will approve the loan, but the family will not have a financial reserve.

A separate problem of any repair is the almost inevitable exit over the estimate. In the process, old pipes are opened, additional wall alignment is required or materials are purchased. Marcel recommends setting aside a 15-20% reserve in advance over the original budget. This stock is better to have your own money. The most dangerous scheme is to take a loan exactly for the amount of the estimate, spend it, and then get the missing one with a credit card. So, instead of one understandable loan, several debts with different costs appear.

Also, the expert advises not to confuse repair with real estate investment. Expensive designer kitchens or premium plumbing increase the comfort of the owner, but the market is not obliged to compensate for these costs when selling an apartment. Taking a multi-year loan under the argument “this is an investment in housing” is very risky. Especially if the loan repayment period is much longer than the period during which the repair will please. Paying five years for a cosmetic interior is a poor financial construct.

The main question, according to the expert, should sound not “is it possible to take a loan for repairs”, but “what problem he will solve.” To borrow reasonably for the necessary work with an understandable estimate and controlled payment. For example, if the completion of a renovation allows you to move into your apartment and stop renting, the loan economy changes. Repairs become a financial trap only when the lack of budget is paid on credit. Without a clear amount, reserve and limit payment, a project for a couple of months easily turns into a debt for several years.