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Regional mortgage loans

Regional mortgage loans

The borrower/co-borrower shall be a citizen of the Republic of Armenia (with registration address in the Republic of Armenia), whose principle source of income is located in the RA.

1. Loans for renovation of a residential house/apartment

Loan purpose

 

House/apartment renovation, improvement of housing conditions. According to the requirements set by the internal regulations /MQS of the NMC
Currency AMD
Maturity Minimum 5 years, maximum 20 years
Interest rate 11%
Loan amount

Minimum amount - AMD 5 mln.

Maximum amount AMD 25 mln.
Loan disbursement fee , is charged once, before disbursement of the loan 
0.5 percent of the loan amount, minimum AMD 50,000

Monthly service fee

Isn’t applied
Fee for review of the loan application AMD 3,000, is charged once, at the time of recording the loan application

General provisions and conditions

Security
Pledge of the renovated house/apartment

Loan-to-value (LTV) ratio
Not more than 70% of the evaluated market value of the collateral.

Procedure of repayment of the loan and interest amount
Monthly, by annuity method, or equal instalments of the loan amount.
If the borrower’s income is obtained from agriculture, then the instalments (repayment of the principal loan amount) can be matched with the borrower’s cash flows (seasonal income). Annual number of instalments cannot be less than 2. In any case, monthly payment of the interest amount is mandatory.

Obligations to income (OTI)
Up to 45%

Creditworthiness assessment
According to the MQS requirements in force.

Collateral evaluation
Real estate evaluation by an independent appraiser, according to the requirements set by the NMC.
In case of loans disbursed in villages, real estate can be appraised by the respective employee of the Bank.

Geography
The whole territory of the RA, except Yerevan city (based on the location of the funded real estate).

Data about the credit history

  • Inquiry to ACRA credit bureau
  • If the borrower has an outstanding loans/s/, then the latter shall be classified as a standard loan, according to the regulation jointly approved by the CBA and the MFE of the RA, and there shall be no outstanding overdue liabilities for the loan/s/
  • during the last twelve months, the total number of overdue days for all loans /outstanding and repaid/ shall not exceed 30 calendar days

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
Insurance (proportionate to income) of the collateral, as well as the borrower and co-borrowers from death through an accident, is made every year, for the balance amount of the loan.

Other provisions
A renovation loan can be disbursed in Yerevan only if it is energy efficient.

Other requirements

  • Such mortgage loans for purchase of real estate shall be presented, in case of which:

- the seller and buyer are not members of the same family (according to the RA Law “On Banks and Banking”);
- the requirements of the legislation on prevention of money laundering and terrorism financing are observed;
-target usage of the loan shall be ensured throughout the maturity of the loan;
- construction and renovation works shall be fully completed 1 year after disbursement of the last tranche of the loan;
- the photographs of the property under construction/renovation shall be submitted, both before construction/renovation and after disbursement of each tranche (to get a full view).

  • The remaining requirements - according to the NMC’s "Regulation on Housing Finance, Refinancing of Loans in the 4th Stage of the Project"

Requirements towards guarantor

  • One guarantor (if necessary, also guarantee of other persons);
  • Acceptable guarantor is a private individual /private individuals/ having a steady and proven income. The guarantor:
  • Cannot be a co-borrower at the same time;
  • Shall not have problematic liabilities at the time of disbursement of the loan;
  • Shall not have credit liability/ies/ overdue for total 30 and more days for all loans during the last one year;
  • Availability of a report from ACRA credit bureau regarding the guarantor is mandatory.

2. Loans for purchase of a residential house/apartment

Loan purpose Purchase of a house/apartment. According to the requirements set by the internal regulations /MQS of the NMC

 

Currency AMD
Maturity Minimum 5 years, maximum 20 years
Interest rate 11%
Loan amount

Maximum amount AMD 25 mln.

Loan disbursement fee , is charged once, before disbursement of the loan 
0.5 percent of the loan amount, minimum AMD 50,000

Monthly service fee

Isn’t applied
Fee for review of the loan application AMD 3,000, is charged once, at the time of recording the loan application

General provisions and conditions

Security
Pledge of the purchased real estate, if the loan amount is above AMD 2 million. If the loan amount is below AMD 2 million, pledge of movable property and/or guarantee of a third person is acceptable.

Loan-to-value (LTV) ratio
Not more than 70% of the collateral value. The value shall be either the evaluated market value or the purchase price, whichever is the least.

Procedure of repayment of the loan and interest amount
Monthly, by annuity method, or equal instalments of the loan amount.
If the borrower’s income is obtained from agriculture, then the instalments (repayment of the principal loan amount) can be matched with the borrower’s cash flows (seasonal income). Annual number of instalments cannot be less than 2. In any case, monthly payment of the interest amount is mandatory.

Obligations to income (OTI)
Up to 45%

Creditworthiness assessment
According to the MQS requirements in force.

Collateral evaluation
Real estate evaluation by an independent appraiser, according to the requirements set by the NMC.
In case of loans disbursed in villages, as well as in case of pledging movable property (for loans with an amount below AMD 2 million), real estate can be appraised by the respective employee of the Bank.

Geography
The whole territory of the RA, except Yerevan city (based on the location of the funded real estate).

Data about the credit history

  •  Inquiry to ACRA credit bureau
  •  If the borrower has an outstanding loans/s/, then the latter shall be classified as a standard loan, according to the regulation jointly approved by the CBA and the MFE of the RA, and there shall be no outstanding overdue liabilities for the loan/s/
  •  during the last twelve months, the total number of overdue days for all loans /outstanding and repaid/ shall not exceed 30 calendar days

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
Insurance (proportionate to income) of the collateral, as well as the borrower and co-borrowers from death through an accident, is made every year, for the balance amount of the loan.

Other provisions
A loan can be disbursed in Yerevan only if it is energy efficient.

Other requirements

  •  Such mortgage loans for purchase of real estate shall be presented, in case of which:

- the seller and buyer are not members of the same family (according to the RA Law “On Banks and Banking”);
- the requirements of the legislation on prevention of money laundering and terrorism financing are observed;
-target usage of the loan shall be ensured throughout the maturity of the loan;
- construction and renovation works shall be fully completed 1 year after disbursement of the last tranche of the loan;
- the photographs of the property under construction/renovation shall be submitted, both before construction/renovation and after disbursement of each tranche (to get a full view).

  •  The remaining requirements – according to the NMC’s "Regulation on Housing Finance, Refinancing of Loans in the 4th Stage of the Project"

Requirements towards guarantor

  •  One guarantor (if necessary, also guarantee of other persons);
  •  Acceptable guarantor is a private individual / private individual /having a steady and proven income. The guarantor:
  •  Cannot be a co-borrower at the same time;
  •  Shall not have problematic liabilities at the time of disbursement of the loan;
  •  Shall not have credit liability/ies/ overdue for total 30 and more days for all loans during the last one year;
  •  Availability of a report from ACRA credit bureau regarding the guarantor is mandatory.

3. Loans for construction of an energy efficient residential house

Loan purpose

 

Construction of a house. According to the requirements set by the internal regulations /MQS of the NMC
Currency AMD
Maturity Minimum 5 years, maximum 20 years
Interest rate 11%
Loan amount

Maximum amount AMD 25 mln.

Loan disbursement fee , is charged once, before disbursement of the loan 
0.5 percent of the loan amount, minimum AMD 50,000

Monthly service fee

Isn’t applied
Fee for review of the loan application AMD 3,000, is charged once, at the time of recording the loan application

General provisions and conditions

Security
Pledge of the existing real estate and the land plot. After construction, pledge of the new house. If the loan amount is below AMD 2 million, pledge of movable property and/or guarantee of a third person is acceptable.

Loan-to-value (LTV) ratio
Not more than 70% of the evaluated market value of the collateral.

Procedure of repayment of the loan and interest amount
Monthly, by annuity method, or equal instalments of the loan amount.
If the borrower’s income is obtained from agriculture, then the instalments (repayment of the principal loan amount) can be matched with the borrower’s cash flows (seasonal income). Annual number of instalments cannot be less than 2. In any case, monthly payment of the interest amount is mandatory.

Obligations to income (OTI)
Up to 45%

Creditworthiness assessment
According to the MQS requirements in force.

Collateral evaluation
Real estate evaluation by an independent appraiser, according to the requirements set by the NMC.
In case of loans disbursed in villages, as well as in case of pledging movable property (for loans with an amount below AMD 2 million), real estate can be appraised by the respective employee of the Bank.

Geography
The whole territory of the RA, except Yerevan city (based on the location of the funded real estate)

Data about the credit history
• Inquiry to ACRA credit bureau
• If the borrower has an outstanding loans/s/, then the latter shall be classified as a standard loan, according to the regulation jointly approved by the CBA and the MFE of the RA, and there shall be no outstanding overdue liabilities for the loan/s/
• during the last twelve months, the total number of overdue days for all loans /outstanding and repaid/ shall not exceed 30 calendar days

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
Insurance (proportionate to income) of the collateral, as well as the borrower and co-borrowers from death through an accident, is made every year, for the balance amount of the loan.

Other provisions
A loan can be disbursed in Yerevan only if it is energy efficient.

Other requirements
• Such mortgage loans for purchase of real estate shall be presented, in case of which:
- the seller and buyer are not members of the same family (according to the RA Law “On Banks and Banking”);
- the requirements of the legislation on prevention of money laundering and terrorism financing are observed;
-target usage of the loan shall be ensured throughout the maturity of the loan;
- construction and renovation works shall be fully completed 1 year after disbursement of the last tranche of the loan;
- the photographs of the property under construction/renovation shall be submitted, both before construction/renovation and after disbursement of each tranche (to get a full view).
• The remaining requirements – according to the NMC’s "Regulation on Housing Finance, Refinancing of Loans in the 4th Stage of the Project"

Requirements towards guarantor
• One guarantor (if necessary, also guarantee of other persons);
• Acceptable guarantor is a private individual / private individual /having a steady and proven income. The guarantor:
• Cannot be a co-borrower at the same time;
• Shall not have problematic liabilities at the time of disbursement of the loan;
• Shall not have credit liability/ies/ overdue for total 30 and more days for all loans during the last one year;
• Availability of a report from ACRA credit bureau regarding the guarantor is mandatory.