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Loans for improvement of Housing Conditions

Loans for Residential Property Renovation/Improvement of Housing Conditions and Enhancing Energy Efficiency of Residential Property

The loan is provided to RA citizens, whose principal source of income is located in the RA.

Purpose of the loan:

Housing microloans - Improvement of housing conditions/renovation of residential property.

Energy efficient renovation loans - Renovation of residential property, aimed at enhancing energy efficiency

  Housing microloans Energy efficient renovation loans
Loan currency  AMD AMD 
Loan maturity 5 years 10 years
Maximum loan amount Minimum AMD 275.000, 
maximum AMD 2.200.000
Maximum AMD 5.500.000
Grace period of repayment of the principal loan amount 6-12 months 6-12 months
Interest rate 13% 11%
Fee for review of the loan application AMD 3,000, is charged once, at the time of recording the loan application
Loan disbursement fee One-off fee - AMD 10.000, before disbursement of the loan

 

Final evaluation of energy efficiency

Is conducted by the Bank to make a decision to provide/not to provide the grant. If in the result of primary evaluation of energy efficiency it is found out that enhancement of energy efficiency wasn't considered by the borrower as a significant condition, then final evaluation of energy efficiency isn't conducted for that loan.

Is conducted by the Bank:

  • to clarify whether at least 50% of the amount spent on acquisition of materials/items within the framework of the renovation loan was used for acquisition of materials/items intended for enhancement of energy efficiency, and
  • To make a decision to provide/not to provide the grant and generate the required reports.

 

 

 

 

Grant

The borrower gets a grant of 10% of the contractual amount of the loan, which is used for repayment of the principal amount, if more than 50% of the loan amount is used for acquisition of materials/items intended for enhancement of energy efficiency.

The following provisions are also preconditions for provision of the grant:

  • The fact of acquisition of energy efficient materials/items shall be confirmed by the results of the final evaluation of energy efficiency.
  • At the time of applying to the Bank for the grant, the borrower shall have no outstanding overdue credit liabilities.

The borrower gets a grant of 5% of the contractual amount of the loan, which is used for repayment of the principal amount, if the requirements towards energy efficient materials/items (share and list) acceptable within the framework of the Project are met and in the result of renovation the energy saving indicator is minimum 35%.

The following provisions are also preconditions for provision of the grant:

  • The fact of meeting the established requirement towards energy saving shall be confirmed by the results of the final evaluation of energy efficiency.
  • At the time of applying to the Bank for the grant, the borrower shall have no outstanding overdue credit liabilities.

General provisions and conditions

Penalty

In case of violation of the repayment terms specified by the agreement, the Borrower pays penalty to the Bank at the rate of 0.13% of the overdue amount for each day of delay.

Insurance

Housing microloans

Insurance of the borrower and co-borrowers from death through accidents for the amount of the credit liability, according to the tariffs of the companies cooperating with the Bank.

Energy efficient renovation loans

Insurance of the pledged real estate for the whole period of validity of the collateral agreement, for the balance amount of the loan, according to the tariffs of the companies cooperating with the Bank.
Insurance of the borrower and co-borrowers from death through accidents, for the balance amount of the loan, according to the tariffs of the companies cooperating with the Bank.
Requirements towards guarantor

Housing microloans:

One guarantor (if required, guarantee of other persons), if required, another guarantee.
An acceptable guarantor is a private individual/s/, who shall have stable and valid income. The guarantor:

  • Cannot simultaneously be a co-borrower;
  • Shall not have problematic liabilities at the time of disbursement of the loan;
  • Shall not have delays of 20 days and more in line of credit liabilities and all loans during the last one year;
  • Availability of a report from ACRA credit bureau regarding the guarantor is mandatory.
  • Restriction of locality of the residential property to be renovated

Housing microloans:

On the entire territory of the RA, except for the Central administrative district of the city of Yerevan.

Energy efficient renovation loans:

On the entire territory of the RA, except for the Central administrative district of the city of Yerevan.

Other conditions of loan disbursement

In case of providing loans for the purpose of renovation of residential property/improvement of housing conditions, not secured with pledge of real estate, the Bank’s Financial Advisor, before disbursement of the loan, shall visit the apartment to be renovated and document it /photographs, etc./.

Other conditions - according to the conditions specified by the NMC’s "Regulation on Housing Microloans and Energy Efficient Renovation Loans".

The loans are provided at the head office and branches.