Friday, November 26 2010 17:35
Demand for mortgage grew after government softened the terms of the program "Affordable Housing for Young Families"
ArmInfo. The Government of Armenia has provided 187 loans in the amount of 1.541 billion drams in total as part of the program "Affordable Housing for Young Families", Karen Tamazyan, Head of the Armenian Finance Ministry Department for Financial Markets, said in a press conference on Friday.
He said that the government is currently studying another 33 applications for mortgage loans for as total of 231.4 million drams.
Out of 187 loan agreements 131 for a total of 1.2 billion drams were made in Yerevan and the other 56 for a total of 306 million drams in the regions.
On November 11 the government increased funding from 2% to 4% and reduced prepayment from 30% to 10%. Thus, the interest on mortgage loans in the region will total 6.5%-7%. In addition, the government softened mortgage security requirements. Big enterprises can provide guarantees that will be considered as pledge security.
Refinancing under the program has reached 1.1 billion drams out of the total 3 billion drams. The government also softened requirements to the borrowers. Specifically, the loan is available to the families where one spouse is under 35, whereas earlier the total age of the couple couldn't exceed 60 years.
To recall, the Central Bank registered Affordable Housing for Young Families UCO on February 16 on the bases of the state target program of affordable housing for young families approved by the Government on Jan 29 2010. The annual interests rate on the loans provided under the given program is 10.5%, including the government finances 2%. The cost of the housing cannot exceed 6 million drams and the prepayment is 30% of total cost. The loan maturity is 10 years. The required monthly income of a family is at least 300- 350,000 drams inclusive of financial assistance from family and relatives.
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