Property Secured Personal Loans (without income statements)

Loan purpose

The loan is provided for purchase/order of goods (works, services) intended for personal, family, household or other uses, unassociated with entrepreneurial activities

Eligibility

RA residents aged 18-63 who during the debt service period will not reach the age of 63, otherwise the potential borrower needs a co-borrower to qualify for the loan.

Loan currency

AMD, USD, Euro

Loan amount

AMD

2,000,000 – 50,000,000

USD/Euro

4,000 – 100,000

Loan repayment period

Fixed interest rate

24 - 84 months

Floating interest rate

36 – 120 months

Nominal (fixed) interest rates per annum

Loan-to-Value ratio: up to 30%

Actual

Loan-to-Value ratio: 31%-50%

Actual

AMD

18% - 19%

21․13%

19%-20%

23․66%

USD

12.5%

15.18%

13.5%

16․16%

Euro

11.5%

13․81%

12.5%

14․87%

Nominal (floating) interest rates per annum

AMD

Loan-to-Value ratio: up to 30%

starting 18% (fixed component: starting 9% + variable component)

21․23%

Loan-to-Value ratio:  31%-50%

starting 19% (fixed component: starting 10% + variable component)

22․44%

USD

Loan-to-Value ratio: up to 30%

starting 13% (fixed component: starting 12% + variable component)

14․48%

Loan-to-Value ratio:  31%-50%

starting 14% (fixed component: starting 13% + variable component)

15․63%

Euro

Loan-to-Value ratio: up to 30%

starting 11.5% (fixed component: starting 11.5% + variable component)

13․25%

Loan-to-Value ratio:  31%-50%

starting 12.5% (fixed component: starting 12.5% + variable component)

14․38%

The maximum and minimum threshold of floating rate fluctuations

+4%, but not more than 21%

The variable component of the floating interest rate will be revised on the forthcoming revision date following the expiration of the  24^th month, thereafter, every 6 months with application of the rate (published on the Bank’s website) effective at the moment of revision.

The floating interest rate is the interest rate of the loan after the expiration of the 24th month of the loan.
The floating interest rate becomes effective upon the expiration of the 24th month of the loan agreement as a loan interest rate specified in the agreement. The variable component of the floating interest rate is revised regularly - twice a year – on February 1 and August 1. As a variable component the interest rate applicable (actually published on the website) in the Bank is applied since the forthcoming revision date following the expiration of the 24th month.
The floating interest rate is a nominal interest rate which is calculated according to the following formula.
𝑹𝐅 = 𝐑𝐕 + 𝐑𝐌
where RF – Floating interest rate
RV – Variable component
RM – Fixed component

The variable component of the floating interest rate (RV) is defined on the basis of the following market rates, depending on the loan currency:

• The calculation of the main variable component in AMD is based on the yield to maturity of Armenian 6-month Government (treasury) bills. Information on the yield to maturity of Armenian 6-month Government (treasury) bills can be retrieved from the relevant publications (yield curve) on the official website of the CBA at the following link: https://www.cba.am/am/SitePages/fmofinancialmarkets.aspx.
  The variable component is reviewed on February 1 and August 1 each year. The variable component as of February 1 is equal to the average applicable interest rate effective for the period from June through November of the previous year. The variable component as of August 1 is equal to the average applicable interest rate effective for the period from December of the previous year through May of that specific year.
  Whenever the above indicator becomes inaccessible or irretrievable and the definition of the interest rate becomes impossible for the next period, the interest rate for the next period is determined based on the secondary indicator used by the Bank.
• The calculation of the secondary variable component in AMD is based on the interest rates of the AMD-denominated deposits (except demand ones) of individuals for a one-year term which are published by the CBA. Information on the interest rates of the AMD-denominated deposits (except the demand ones) of individuals for a one-year term can be retrieved from the relevant publications on the CBA website at the following link: https://www.cba.am/am/SitePages/statmonetaryfinancial.aspx.

The secondary variable component is revised on February 1 and August 1 each year. The secondary indicator as of February 1 is calculated as an average of the interest rates published from June through November of the previous year. The secondary indicator as of August 1 is calculated as an average of the interest rates published from December of the previous year through May of that specific year.

• The calculation of the main variable component in USD is based on the interest rates of the USD-denominated deposits of individuals for a one-year term which are published by the CBA. Information on the interest rates of the USD-denominated deposits of individuals for a one-year term can be retrieved from the relevant publications on the CBA website at the following link: https://www.cba.am/am/SitePages/statmonetaryfinancial.aspx.
  The variable component is revised twice a year on February 1 and August 1. The variable component as of February 1 is calculated as an average of the interest rates published from June through November of the previous year. The variable component indicator as of August 1 is calculated as an average of the interest rates published from December of the previous year through May of that specific year. Whenever the above indicator becomes inaccessible or irretrievable and the definition of the interest rate becomes impossible for the next period, the interest rate for the next period is determined based on the secondary indicator used by the Bank.
• The calculation of the secondary variable indicator in USD is based on Overnight secured financing rate for 6-month term (CME Term SOFR USD 6 Month). Information on Overnight secured financing rate for 6-month term can be retrieved from the relevant publications on the Bloomberg terminal at TSFR6M link. The variable component is revised twice a year on February 1 and August 1. The variable component as of February 1 is calculated as an average of the interest rates published from June through November of the previous year. The variable component as of August 1 is calculated as an average of the interest rates published from December of the previous year through May of that specific year.
• The calculation of the main variable component in Euro is based on the European Interbank Offered 6-month Rate (EMMI EURIBOR 6 Month). Information on the European Interbank Offered 6-month rate can be retrieved from the relevant publications on Bloomberg terminal using the EUR006M link.  The variable component is revised twice a year on February 1 and August 1. The variable component as of February 1 is calculated as an average of the interest rates published from June through November of the previous year. The variable component as of August 1 is calculated as an average of the interest rates published from December of the previous year through May of that specific year.
• The calculation of the secondary variable component in Euro is based on the 6-month yield curve of the German government bonds. Information on the interest rate of the 6-month yield curve of the German government bonds can be retrieved from the publications on Bloomberg terminal using the YCGT0016 link.

In case of moving from the primary to the secondary variable component an adjustment factor can be applied.

Loan disbursement method

AMD

Non-cash (the loan amount is credited to the seller’s account).

USD, Euro

Non-cash (the loan amount is credited to the card account using a payment card).

Penalty charged for loan prepayment

Loans regulated under the RA law on Consumer Loans

Not applicable

Loans that aren’t regulated by the RA law on Consumer Loans

If prior to the end of the first half of the loan period the Borrower repays monthly principal exceeding the scheduled amount under the agreement, the Borrower shall pay a penalty at 1% of the amount exceeding the monthly payable principal.

No penalty is applied to loans in foreign currency.

Penalty for overdue loan principal and interest

For overdue principal - 0.015% per day,

For overdue interest - 0.1% per day.

Loan security

Real property: apartment, single-family home, other premises (except premises intended for manufacturing purposes) in Yerevan, as well as in Lori, Shirak and Kotayk provinces.

Apart from pledging real property, the Borrower shall provide a surety bond issued by at least one individual or legal entity.

Loan-to-Value ratio

Up to 50% of the appraised value of the real property.

Assessment of creditworthiness

If the loan amount exceeds 30% of the collateral value, the Borrower’s or surety’s Fico score should be 510 and higher. Besides, the borrower should not have classified loans for the last 1 year, nor should the number of overdue days exceed 30.

Fees charged

·        In case of cash withdrawal, a withdrawal fee will be charged by the Bank.

Timeframe for making decisions on approving or rejecting the loan application

·        The decision on approval or rejection of the loan application is made within 10 (ten) business days upon submission of the full package of preliminary documents required by the Bank.

·        The loan is provided to the Borrower in case of the Bank’s positive decision within 2 (two) business days upon completion of the pledging process.

Other conditions

The borrower and the pledger must be the same individual, otherwise they must run a joint household (live together).