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

1.         

Loan purpose

Loans will be granted for the following purposes:

1.      Purchase of energy efficient residential real  property (apartment, private/town house) or purchase of real property  in marzes  (in primary and secondary markets),

2.     Renovation of a real property in marzes or renovation of any energy-efficient property  

3.     Construction of energy-efficient  town houses, private houses or residential property in marzes,

4.     Purchase, construction or renovation of energy-efficient real property in marzes

2.         

Eligible borrowers

Individuals - RA residents aged 18– 58, whose income source is in Armenia and who during the debt service period will not reach the age of 63 years. Otherwise, a co-borrower (if any) should comply with that requirement.

3.         

Loan currency

AMD

4.         

Loan amount

Purchase,

Construction of real property

AMD 2,000,000- AMD 35,000,000

Purchase and construction of energy-efficient real property in marzes and in Yerevan

AMD 3,000,000- AMD 45,000,000

Renovation

AMD 2,000,000- AMD 10,000,000

5.         

Loan repayment term

Purchase,

Construction of real property

120 –  240 months

Renovation

60 – 84 months

6.        

Nominal annual interest rate

Purchase of real property

9.5 %

Construction of real property

12% until the loan is refinanced

Renovation

10.5 %

Purchase of energy-efficient real property in marzes

9%

Construction of energy-efficient real property in marzes

12% until the loan is refinanced

Renovation of energy-efficient real property in marzes

10%

In case of down payment, life and property insurance executed by the Bank on behalf of the customer  (is implemented starting the second year of the effectiveness of the loan agreement)

Mentioned interest rate + 0.6%

7.         

In case of life and property insurance executed by the Bank on behalf of the customer  (is implemented starting the second year of the effectiveness of the loan agreement)

Mentioned interest rate + 0.4%

8.        

Penalty payable for early repayment of the loan principal amount

No penalty is applied

9.        

Fines payable for overdue principal amounts and overdue loan interest

For overdue principal amount - 0.015% per day,

For overdue interest - 0.1% per day.

10.        

Method of loan repayment

Annuity scheme or equal amounts of principal repayments; payments should be made on a monthly basis.

11.        

Security for loan repayment

Real property to be purchased or constructed or other residential property. In case of construction, the land lot to be developed, and if needed, additional residential property.

12.        

Loan-to-value ratio

1.     Not more than 70% ^[1] of the residential property value.

2.     Not more than 90% of the residential property value - in case additional residential property is to be pledged. While in case of pledging the property to be purchased with additional residential property, the loan amount cannot exceed 70% of the total value of the mentioned items of real property.

3.     In case of loans designed for purchasing real property (if the property to be purchased is the only means of security) the loan amount can be up to 90% of the collateral value, if mortgage insurance is available at the amount exceeding the 70% of Loan-to-Value ratio.

13.        

Insurance

1.      Pledged property insurance

2.     Life insurance policy for the borrower and co-borrower(s) (if any). In case of co-borrower(s), the life insurance should be executed at the expense of the loan amount in proportion to the earnings of the borrower and co-borrower(s).    

3.     The loan amount can be 90% at a maximum, with mortgage insurance at the amount exceeding the 70% of Loan-to-Value ratio. Mortgage insurance should be effective until the borrower makes a payment exceeding 70% of Loan-to-Value ratio.

14.        

Loan disbursement method

·      Non-cash (the amount should be transferred to the seller’s account),

·      Loans for renovation and construction are disbursed in a lump sum or in several tranches, this decision being the responsibility of a relevant competent body. In case of granting the loan in several tranches, their number is determined based on the cost estimate submitted by the borrower, loan term, loan amount and borrower’s creditworthiness.

15.        

Other terms and conditions

·      In case of real property acquisition, the Borrower should make a down payment to the Bank^[2], which should be frozen till the loan disbursement.

·      In case of real property to be purchased in the primary market, as a document certifying the down payment the Borrower should submit to the Bank a receipt of the down payment issued by the developer and/or down payment agreements/contracts.

·      In case of construction of private/town houses the maximum loan amount should not exceed 80% of the construction cost estimate submitted by the borrower.

·      Loans for construction should be disbursed in tranches. Notably the last tranche should be disbursed for financing the final phase of construction works and should not exceed 20% of the loan amount.

·      In case of purchasing real property in a residential house under construction, and the developer’s special account is with another bank, as a means of security for the loan besides the right to buy the mentioned real property in the house under construction, other real property should be offered as well. Its market value should not be lower than the loan amount to be granted.

16.        

Timelines for making decisions on approval/rejection of  loan application

·      The decision regarding the approval or rejection of the loan application should be made within 10 (ten) business days upon submission of the entire package of preliminary documents required by the Bank for making a relevant decision.

·      The loan will be granted in case of a positive decision by the Bank, within 2(two) business days upon completion of the pledging process.