Individual loans provided to individuals by products / Terms and Tariffs /

Commercial mortgage loans

Loan purpose

The loan is granted for acquisition, renovation, modernization or construction of commercial property, i.e industrial, public, or other commercial area, building (from the primary and the secondary market).

For renovation and construction loan provisions cost estimation of anticipated expenses is taken into consideration.

Who can apply

Individual residents of RA between the age of 18-63, whose age will not exceed 63 years throughout the loan service period or have a co-borrower meeting the above criteria throughout the loan service period.

Loan currency

AMD, USD, EURO

Loam amount

Property purchase, Construction  

From AMD 10,000,000 till AMD 120,000,000 or equivalent in foreign currency

Renovation

From AMD 5,000,000 till AMD 30,000,000 or equivalent in foreign currency

Loan repayment period

Property purchase, Construction  

Up to 180 months

Renovation

Up to 84 months

Annual nominal interest rate

AMD

13.2%-17%

USD

9.2%-12%

EUR

7.2%-10%

In case of property insurance by the bank instead of the customer (implemented from the second year of the loan)

Mentioned interest rate + 0.2%

Early loan repayment penalty

No early loan repayment fee is applicable

Penalty for loan principal and/or interest overdue

For overdue principal - 0,015 % daily,
For overdue interest - 0,1 % daily

Loan repayment security measure

The property that is being purchased, renovated, other property. In case of construction, the land plot where the property should be constructed/the property under construction.

Loan to value ratio[1]

Purchase from primary market (constructor)[2]

Up to 90% of the property value

Purchase from secondary market

Up to 85% of the property value

Construction and renovation

Up to 70% of the property value

Insurance

Property insurance – mandatory to do each year on loan’s outstanding amount

Loan provision methods

· Non-cash – the amount is transferred to the seller’s account
· Loans for renovation and construction purposes are granted one-off or in phases. It is determined by the Authorized body responsible for loan approval.
· In case if loan is provided in phases, then those phases are defined taking into consideration anticipated cost expenditure provided by the customer, loan term, loan amount, customer’s creditworthiness.

Other terms

· In case of property purchase the Borrower credits prepayment [3] on the Bank’s account which is being frozen till loan disbursement 
· The borrower may not make a prepayment and instead pledge additional property. In this case the loan amount provided to the Borrower should not exceed the estimated market value of the property to be purchased, meanwhile keeping 70% loan to value ratio.
· In case of property purchase from primary market as a document confirming the prepayment, the Customer may present to the Bank payment slip provided by the constructor and/or prepayment agreements/consents.
· In case of obtaining the “purchase right” of the property, the “purchase right” can be considered as loan security. In this case the Bank can request to pledge the funds credited on the constructor’s special account in the favor of the Bank in order to secure:

a) the constructor’s obligation to transfer the property to the buyer upon completion of the construction
b) the constructor’s obligation to return the prepayment to the buyer in case of termination of “the right of purchase” agreement
c) Upon completion of the construction and along with receiving the ownership certificate of the property, to fulfill the obligation to register the pledge on the name of the Bank

Deadlines for approving or rejecting loan provision

· The decision to approve or reject the loan is made within 10 (ten) working days maximum, after fully providing all the initial documents requested by the Bank.
· The loan is disbursed in case of positive decision made by the Bank and within maximum 2 (two) working days since the property is pledged.

[1] Loan to value ratio is calculated based on the lower value as per property’s  valuation act or purchase price
[2] In case of incomplete construction (when purchasing from constructor) property value is considered to be the sales and purchase price  which is stated in the advice provided by the constructor, and later is captured in the Sales and Purchase agreement
[3]  By the difference of property purchase price and loan amount