Interest rate cut, how much did mortgage payments actually save? Someone posted their bill: 1.1 million yuan

In recent years, with multiple reductions in mortgage interest rates, many families’ monthly payments have quietly changed. Li Kaisheng purchased a second-hand house in Pudong New Area, Shanghai at the end of 2022. Based on the initial 4.65% and the current 3.2% mortgage rates, his family’s mortgage rate has decreased by 145 basis points, saving nearly 1.1 million yuan over a 30-year loan.

This year’s Two Sessions continue to focus on “benefiting people’s livelihoods.” In recent years, with multiple reductions in mortgage interest rates, many families’ monthly payments have quietly changed.

Li Kaisheng is a lawyer at a Shanghai law firm. At the end of 2022, to enroll his two children in nearby schools, he and his wife Qiu Yanfei chose a second-hand house in Pudong New Area, Shanghai. After calculating their total family assets, they decided to take out a loan of 3.65 million yuan to buy the house, with a monthly payment of 18,800 yuan. Six months later, mortgage rates were lowered, easing their repayment pressure significantly.

Shanghai resident Li Kaisheng: I started in January 2023 with a monthly repayment of 18,820.74 yuan, and by December 2024, it had decreased to 17,283.37 yuan. In January 2026, it was lowered again. Overall, the rate has decreased by about 3,000 yuan, and now my monthly payment is less than 16,000 yuan, saving over 36,000 yuan a year.

In August 2023, the People’s Bank of China and the State Financial Supervision and Administration issued a notice allowing existing first-home mortgage loans to apply for lower interest rates. After adjustment, the mortgage rate for existing first homes in Shanghai was reduced from 4.65% to 4.3%. In October 2024, over a hundred banks collectively announced further adjustments to mortgage rates nationwide for eligible loans. Coupled with multiple cuts in the Loan Prime Rate (LPR) since 2023, the mortgage rate for existing first homes in Shanghai has now fallen to 3.2%.

Shanghai resident Li Kaisheng: At that time, I was early in my career, with limited savings. Honestly, the pressure was quite high. Thanks to the national policy of lowering mortgage rates, my financial burden has eased a lot.

With lower monthly payments, more money is available for daily expenses and household needs.

Shanghai resident Li Kaisheng: We now pay half the cost for extracurricular classes for our two children, which has basically been saved.

Based on the initial 4.65% and current 3.2% mortgage rates, Li Kaisheng’s family’s mortgage rate has decreased by 145 basis points, saving nearly 1.1 million yuan over 30 years. The 3.65 million yuan was once a heavy burden for this family; the 1.1 million yuan is the warmth released by policy dividends to this small family. Today, countless families across the country are like them, seeking to add to their lives amid the “subtraction” of monthly payments.

Shanghai resident Li Kaisheng: I hope to upgrade to a bigger house and live in a better community when the time is right, and live a better life.

(Source: CCTV Finance)