President Ilham Aliyev amends rules of mortgage lending
Baku, Azerbaijan, May 2
Azerbaijani President Ilham Aliyev has signed a decree amending the "Decree on Certain Issues of Mortgage Lending in Azerbaijan”, dated June 22, 2016.
In particular, the amendments determine the rules for restructuring of mortgage loans.
In accordance with the amendments, in case of change of economic or legal condition, as well as in case of financial difficulties, a borrower can apply to an authorized bank to change the terms of loan agreement (loan restructuring).
The authorized bank in three days must review the borrower’s application submitted online or the documents submitted by the borrower in case if the application cannot be received online, and apply to the Azerbaijan Mortgage and Credit Guarantee Fund for restructuring of the loan.
The Fund must decide whether to approve the restructuring of the loan or issue a reasonable refusal within 10 days since the date of the application’s receipt.
The decision is placed in the electronic system and the borrower and the authorized bank are notified about that.
The restructuring is formalized within five days from the date of placement of the decision about approval of the restructuring in the electronic system by the Fund.
The restructuring can be carried out in the following forms:
1. Capitalization of the calculated interest and adding it to the main amount of the debt (if it does not exceed the main amount of the debt);
2. Extension of the loan term, taking into account the requirements for the maximum loan period;
3. Decreasing the interest rate on the loan through a bank commission with the consent of the authorized bank;
4. Granting deferral for loan payments for a period not exceeding one year;
5. The forms of restructuring can be applied together or separately. The restructuring may be carried out for a maximum of three times during the term of the loan and a break between them must be at least one year.
All issues arising from this decree will be solved by the Mortgage and Credit Guarantee Fund. фонд.