Azerbaijan will keep mortgage funding amount at over $ 50 mln
Azerbaijan, Baku, Oct. 9 / Trend A. Akhundov /
Around 40 million manat will be allocated from the state budget to the Azerbaijan Mortgage Fund (AMF) in 2014. i.e. the same number as in 2013, the draft state budget of Azerbaijan for 2014, published by the Ministry of Finance said.
The amount of funds accumulated in the fund will reach 216 million manat.
Currently, the maximum amount of a common mortgage loan through the AMF is 50,000 manat at a rate of eight per cent with a payback period of 25 years. Terms under the social mortgage are 50,000 manat at an annual rate of four per cent with a payback period of 30 years. The initial payment under the social mortgage is 15 per cent, whilst the conventional loan is 20 per cent.
Conditions of mortgage lending are as follows. Loans must be issued in Azerbaijani manats and only to Azerbaijani citizens and the mortgage can only be for an apartment or private house. The volume of mortgage lending must not exceed 80 per cent of the market price and the monthly payment must not exceed 70 per cent of the debtor's monthly income. It is compulsory to take out an agreement on life insurance.
Preferential conditions are granted to family members of war victims, national heroes, internally displaced persons, civil servants with at least a three years' experience, PhDs and those making special contributions to sport as well as to the military with at least a three-year service term. Each family having the right to such a mortgage can only use the opportunity once.
There are 28 authorised banks belonging to the Mortgage Fund. Around 21 insurance companies and 11 appraisal organisations are participants of the mortgage market.
The official exchange rate is 0,7845 AZN/USD on Oct. 9.