Azerbaijan, Baku, June 10 / Trend M.Aliyev /
Azerbaijan has offered to issue an interest-free mortgage to the public.
The social mortgage policy must be re-examined in Azerbaijan, Deputy Parliamentary Social Policy Committee Chairman Musa Guliyev told Tren, further commenting that mortgages should be issued with a commercial purpose.
"Mortgage is a project for the state to support its homeless citizens, and I think that the percentage of the mortgage loan should only be associated with the level of inflation", Guliyev said.
He believes that the state should provide a long-term loan to citizens and then collect the debt based on inflation. He said that one of the main hindrances to mortgage development in Azerbaijan is that the banks pursue financial gain.
"The Azerbaijani government has enough financial resources, the budget increases yearly, oil and gas reserves will be sufficient for 100 years, and no-interest mortgages can already be applied," Guliyev said.
He said that the goal is not only to grant a mortgage to young people and people with certain social needs, but also to grant mortgages to homeless citizens. Guliyev said that not only a commercial, but also a social model of the mortgage should be more widely promoted.
The AMF was established as a PSE in September 2005 in Azerbaijan by presidential decree. Its charter was approved by a separate presidential decree in December 2005. The AMF's main purpose is to create funding mechanisms which would endorse home ownership to Azerbaijani citizens through long-term financing. The AMF also aims to draw domestic and foreign investment toward mortgage financing.
Under the AMF's terms, the maximum amount of conventional mortgages that may be issued in Azerbaijan is 50,000 manat, at a rate of eight percent for 25 years. The social mortgage is 35,000 manat, and may be issued at an annual rate of four percent for 30 years. The initial fee for ordinary and concessional loans is 15 percent.