Adding to his pain, the value of the Hungarian currency, the forint, has plunged; all the ratings agencies have slashed Hungary's credit to junk status; and Hungary's sales tax went up — again — on New Year's Day. It's now at 27 percent, the highest in the European Union. Happy New Year, Jancovics says, with a slight chuckle.
"It is quite hopeless, to tell the truth. I can work maybe 50 hours or 60 a week and still cannot live on [my income]. So that's the situation," he says.
The situation is made far worse by the fact that he took out three loans in Swiss francs. The first — a consumer loan he took out in 2007 — seemed like a good deal at the time, he says. He badly needed money to pay bills. And in 2009, when he had a chance to buy his apartment at a good price, he took out a mortgage, which was also in Swiss francs.
Jancovics says he didn't qualify for a mortgage in forints. But banks, both foreign and Hungarian, were pushing loans in Swiss francs with much lower interest rates — and, some analysts charge, downplaying the risks.
At the time, the exchange rate was 196 forints to the franc. Then, as debt mounted in Greece and elsewhere in the eurozone, and the euro began to look shakier, the Swiss franc became a safe haven for investors — and soared. One franc is now worth 250 Hungarian forints. Jancovics' mortgage burden has gone up nearly 30 percent. His other two loans have gone up even more.
"I knew that they were risky because I knew that there was a risk of the exchange-rate changes. But nobody expected such a big change in the exchange rates," he says.
