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Affordable housing for young families

Affordable housing for young families

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The Affordable Housing to Young Families is a program initiated by the government, which aims at supporting young families to improve their housing conditions.

You can apply to ARARATBANK to get a mortgage loan, if you intend to buy an apartment in Yerevan or in any region of the Republic of Armenia, the value of which does not exceed AMD 25.000.000 and the appraised market value of which does not exceed AMD 26.000.000.

Under the program, mortgage loans shall be disbursed for a maximum loan term of 20 years.

  • Interest rate

    7.2% Of which 2% subsidized, provided that the dwelling real estate is acquired in Yerevan and 4% subsidized, provided that the dwelling real estate is acquired in the regions of the Republic of Armenia

  • Period

    120-240 months

  • Maximum amount

    AMD 17.500.000

  • Currency

    USD

Who is this program envisaged for?

Young families may apply to get a mortgage loan if the total age of spouses not exceed 70. 

    • If your monthly income is not sufficient to get a mortgage loan, then the co-borrower can assume obligations jointly with you. The Borrower’s family members only (spouses, their parents, sisters and brothers) may act as co-borrowers.
    • The customers, whose (spouses and possible co-borrowers) total monthly net income exceeds AMD 500 000, cannot apply for the loan.
    • If one of the customers (spouses) owns other residential real estate (be it an apartment or a residential house), he/she cannot apply for the loan, except for the cases when less than 18,0 sq.m falls on per capita (only for persons that actually reside (are registered) in the apartment/residential house).
    • The customers, who do not plan to reside permanently in the apartment to be purchased (rent out the house before residence, use it as a summer cottage etc.) cannot apply for the loan
Conditions (primary market)
Borrower

RA citizen and resident individual aged 20 

 

Co-borrower RA citizen and resident individual aged 20, who is the member of the Borrower family (a spouse, parents-in-law, sisters and brothers of the Borrower and the spouse) 
Young family definition A family, where spouses are young with total age not exceeding 70 or a single parent 
Loan purpose Acquisition of the dwelling real estate in Yerevan and RA regions for permanent residence purposes 
Currency AMD
Maximum loan amount

- AMD 24.000.000, however, not exceeding 80% of the value of real estate to be acquired (minimum of the appraisal and acquisition values of the real estate shall be taken as a basis for LTV ratio calculation)

- AMD 27.750.000, however, not exceeding 92․5% of the value of real estate to be acquired, if the Borrower pledges another real estate besides a secured dwelling house or apartment to be acquired. At that, in case of pledging the dwelling real estate to be acquired and other dwelling real estate, the loan amount cannot exceed 80% of the total appraised value of the pledged real estate.    

 

Minimum loan amount AMD 5,000,000 
Maximum value of the dwelling real estate to be acquired

The acquisition value shall not exceed AMD 30.000.000 and the appraised market value shall not exceed AMD 31.000.000 .     

Acquisition and appraised values of the real estate to be acquired shall be compared to the average prices (recently published data) published by RA National Statistical Service, taking into account the apartment floor space and location. Particularly, the average value per square meter of the apartment floor space and the given location shall not exceed AMD 31.000.000 .   

Loan security Property to be acquired
Loan maturity 120-240 months
Annual interest rate 7․2%
Loan repayments Annuity
Principle and interest repayments Monthly
Loan disbursement mode

Non-cash

The loan amount along with the down payment shall be transferred to the seller

Insurance

Mandatory, every year.

Borrower and co-borrowers’ insurance against accidents and property insurance in the amount of outstanding loan

Penalty on past-due principle 0.06% daily
Penalty on past-due interest 0.07% daily
Requirements to the credit history of the Borrower and Co-borrowers  Total of past-due days in terms of all existing and repaid loans shall not exceed 30 calendar days within 12 months prior to loan application, as well as if the borrower or co-borrowers have existing loans, such loans must be classified as standard only.  
Credit rating According to the "Procedure for granting mortgage loans"
Application processing fee AMD 1.000
Loan service fee

1% of the loan amount, at least AMD 40,000 and maximum AMD 100,000

See information bulletin in «Provided services'» section 

Conditions ( secondary market)

Please follow the armenian version

Required documents

Please follow the Armenian version

Important to know

 

  • Collateral shall be appraised by the independent licensed appraisal companies cooperating with the Bank at the rates set by the appraisal companies. Please refer here for the list and rates of the appraisal companies.
  • Annual actual interest rate shows how much the loan will cost to the customer in case interests and other payments are repaid in due amounts and specified timelines. Go to this link for calculation of the annual actual interest rate.
  • The collateral shall be subject to insurance at the rates set by insurance companies for the whole loan period. Moreover, appraised liquidation value of the property shall be deemed as basis for the property insurance. Please refer here for the list and rates of insurance companies.
  • The ratio of total monthly principal repayments, Borrower’s and Co-borrowers’ monthly life and property insurance fees to the Borrower’s (Co-borrowers’) net income must not exceed 35 (thirty-five) per cent.
  • After the authorized body has made a loan decision, the borrower shall be notified about it within one day. After the loan disbursement decision has been made, the required documents shall be collected and the loan shall be disbursed within 15 days maximum. If the loan is not disbursed within the mentioned period, the decision made by the authorized body shall be deemed as void and shall be submitted to the authorized body for a second consideration, in case the loan application is subject to review.
  • Fines and penalties are not applied in case of early repayment of the loan.
Useful information

The loan application will be approved if 

  • The customer has submitted the complete package of documentation and the loan application. 
  •  The query to the CBA credit register has shown that the Potential Borrower and/or the Potential Co-borrower did not have any classified liabilities and/or was not 30 days past-due within the last 24 months prior to the query. 
  • The ratio of total monthly principal repayments, Borrower’s and Co-borrowers’ monthly life and property insurance fees to the Borrower’s (Co-borrowers’) net income does not exceed 35 (thirty-five) per cent. 
  • The ratio of total payments specified in Point 3 and other long-term monthly expenses (payments on other loans, alimony, tuition fee, leasing charge, utilities etc.) to the Borrower’s (Co-borrowers’) net income does not exceed 45 (forty-five) per cent.
  • The appraised value of the collateral(s) meets the requirements. 
  • Borrower’s and Co-borrowers’ income meet the requirements.
  • The body authorized to take loan decisions approved the customer’s loan application. 
  • Other 

The loan application will be rejected if 

  • The customer has failed to submit the complete package of documentation and the loan application. 
  • The query to the CBA credit register has shown that the Potential Borrower and/or the Potential Co-borrower had classified liabilities and/or was at least 30 days past-due within the last 24 months prior to the query. 
  •  The appraised value of the collateral(s) does not meet the requirements.
  •  Borrower’s and Co-borrowers’ income does not meet the requirements.
  •  Borrower and Co-borrower have submitted false documentation and/or information.
  •  The loan rejection basis, which was not deleted, is available in the historical credit database. 
  •  The body authorized to tale loan decisions within the Bank has not approved the application.
  •  The loan has been approved, but the applicant has failed to present himself/herself within 15 days after approval or has failed to present the necessary documents.
  •  Other

Loan amount

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Annual interest rate

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Page updated 10.05.2019 | 12:04

In case of discrepancy between Armenian and English versions of the information, the priority is given to the Armenian version.