Mortgage loan to servicemen

1.        

Eligibility

Program is designed for contract officers and senior warrant officers aged 18 – 65 who will not turn 65 during the debt service period, otherwise the loan shall be shared by a coborrower-family member who meets these requirements.

2.       

Loan amount

AMD 2,000,000- AMD 25,650,000

3.           

Loan purpose

Primary market

Secondary market

Acquisition of an apartment or single-family home directly from a property developer

Refinanced by «Home for Youth» RCO CJSC. 

Acquisition of an apartment or single-family home in Armenian secondary market, construction of a single-family home.

Refinanced by «National Mortgage Company» RCO CJSC.

4.       

Nominal interest rates per annum

11%

13%

5.       

Interest subsidized by the Government

5%

6.       

Actual interest rate per annum

11.9%

14.4%

7.       

Loan period

120 - 180 months

120 - 240 months

8.       

Government support for  down payment and/or construction

AMD 2,500,000, in a lump-sum

9.     

Loan repayment method

Monthly annuity payments

10.      

Loan security

The property to be purchased/right to purchase. For construction loans – the land plot to be developed/property under construction, in some cases, also additional residential property.

In case of purchasing an apartment or a single-family home under construction, the loan shall be secured by the loan amount in the developer's special account and the right to purchase the property before the registration of title to the acquired property, thereafter, the loan will be secured by the property that has been acquired.

11.      

Maximum acquisition and market value of real property

AMD 55,000,000 /only for acquisition of real property/

12.      

Loan-to-value ratio

90% of the market or acquisition value of the residential  property/right to purchase, whichever is less.

1.  70% of the residential property to be purchased or constructed ^[1]

2.  Up to 85% of the property value, in case of pledging  also additional property, in this case the loan amount cannot exceed 70% of the total value of the pledged property, otherwise the mortgage loan shall be insured at an amount exceeding 70% of the Loan-to-value ratio

13.      

Loan disbursement method

In a lump-sum

In a lump-sum or in several tranches

14.      

Insurance

• Collateral insurance
• Borrower's and co-borrower(s) life insurance.

• Collateral insurance
• Borrower's and co-borrower(s) life insurance,
• PMI for the down payment

15.      

Penalty for early loan repayment

Not applicable

16.      

Penalty for late payment of loan principal and interest

·          For past due principal - 0,015 % per day,

• For past due interest - 0,1 % per day.  

17.      

Other provisions

• For construction of single-family home, the loan will be provided up to 80% of its estimated cost, in several tranches or in a lump-sum.
• For tranche loans, the last tranche shall not exceed 20% of the loan amount.
• In case of issuance of the loan in a lump-sum, it will be frozen in the bank account and unfrozen in three stages, each time the disbursed amount shall not exceed 40%, while the construction shall be completed within 2 years (no matter the construction permit sets longer period for completion).
• The issues not addressed by these provisions will be subject to regulation under the terms and conditions of the TARGET PROGRAM aimed at providing housing assistance to officers and senior warrant officers in the armed forces. 

18.     

Timeline for making decision on  loan application approval or rejection

• The decision on approving or declining the loan application will be made within 10 (Ten) business days upon submission of the entire package of required preliminary documents.
• The loan will be provided within 2 (two) business days after the approval of the loan application and completion of property pledging procedure.