Azerbaijan, Baku, Oct. 13 / Trend , N.Ismayilova/
In September, the first regional bank of Azerbaijan, Ganja Bank issued five mortgage loans through the Azerbaijan Mortgage Fund (AMF), acting under the Central Bank of the country, said the bank on Oct. 13.
"In September, the bank issued five mortgage loans totaling 122,300 manat, of which three loans worth 67,950 manat were issued on preferential terms."
Initial amount issued by the Mortgage Fund to the bank was 500,000 manat.
Priority in the mortgage lending, Ganja Bank considers financing of new buildings, although under the terms of the fund, mortgage loans are also issued to purchase a house on the secondary market. The priorities, identified by the bank, are conditioned by higher depreciation on the secondary housing market and the risk of problems with insurance companies in the future, as the loans are long term.
Ganja Bank operates since 1994. The bank's central office is located in the Azerbaijani western cty of Ganja.
The bank issues mortgage loans secured on real estate in national currency to the Azerbaijani citizens and the maximum volume of the mortgage loan to 50,000 manat under 8 percent per year for the term of 25 years, social mortgage to 35,000 manat under a 4 percent per year for up to 30 years. Initial payment for ordinary and lax loans is 15 percent.
Conditions of the mortgage lending are as the following: loans must be issues in the national currency with manats and only to Azerbaijani citizens, and an object of the mortgage can only be an apartment or private houses, volume of the mortgage lending must not exceed 85 percent of the market price, monthly payment for a loan must not exceed 70 percent of debtor's monthly income, as well as presence of an agreement on life insurance and others.
Preferable conditions are granted to members of families of war victims, families of national heroes, internally displaced persons, civil servants with at least a three-year experience, candidates PhD and PhD, persons making special contributions to sport, as well as militaries with at least a three-year service term.
Each family having the right to a lax mortgage loan can use this chance only for one time.
In connection with the launch of mortgage loans, 18 banks authorized by the AMF were approved. The 2009 public budget has allocated 14 million manat to finance social mortgage lending.Besides, the fund issued secured bonds worth 55 million manat with a 1,000 manat per value. The bonds worth 38 million manat of total bonds have already been placed. Full placement of the emission will enable to issue roughly 1,100 mortgage loans.
The 2005-2008 Azerbaijani public budget envisaged 94 million manats to fund mortgages through the AMF, and over 73 million manat of this volume has been allocated.
On Oct. 13, the official exchange rate is 0.8032 manat to $1.
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