Baku, Azerbaijan, April 18
By Azad Hasanli – Trend:
In February 2018, authorized lending institutions of Azerbaijan Mortgage and Credit Guarantee Fund CJSC issued loans worth 19.2 million manats, which is 31.5 percent more than in January 2018 and almost 30 percent more than in February 2017, according to the report of the Central Bank of Azerbaijan (CBA).
In February 2018, 50 million manats have been transferred from the state budget to the fund. For comparison, 50 million manats were transferred from the state budget to the fund for the whole last year.
According to the CBA report, in February 2018, the volume of refinancing of loans issued by banks earlier amounted to 22.5 million manats.
The average monthly amount of the loan delivered by the fund’s authorized banks was 45,700 manats in February 2018 (41,651.8 manats in February 2017). The average period of the loan is 281 months (280 months a year earlier). The average annual interest rate is 6.63 percent (6.67 percent a year earlier). The average monthly amount for payments is 325.9 manats (299.4 manats a year earlier).
In general, the fund’s authorized lending institutions have issued 22,032 mortgage loans worth 998.55 million manats since 2006 and up till now.
According to the new mortgage loan issuance order, approved in June 2016, an ordinary mortgage loan will be issued only to Azerbaijani citizens and only in the national currency for a term from 3 years to 25 years, while preferential mortgage - up to 30 years to purchase a house, owned by the citizen. Interest rates on conventional mortgage must not exceed eight percent, while 4 percent per annum in preferential mortgage loan.
The maximum amount of the mortgage loan (including preferential) is determined by the Azerbaijan Mortgage and Credit Guarantee Fund CJSC and must not exceed the cost of repaired housing with an average of 100 square meters in zone #7 in Baku. Annual interest rates on the loan are determined by the company’s Supervisory Board.
The amount of preferential mortgage loan must not exceed 85 percent of the cost of purchased housing by the date of the loan issuance, except for cases when a borrower appeals to decrease the loan amount. The amount of conventional mortgage loan must not be less than 75 percent and more than 85 percent of the cost of purchased housing by the moment of the loan issuance, except for the cases when a borrower appeals to decrease the loan amount.
The monthly payment for a mortgage loan must not exceed 70 percent of a debtor's monthly income. The age of the borrower must not exceed the retirement age according to the legislation. An agreement on life insurance is required.
The family members of war victims, national heroes, internally displaced people, civil servants with at least a three years' experience, teachers of secondary schools with at least a five-year service term, PhDs, doctors of science and those having special merits in sport as well as the military with at least a three-year service term can use the preferential conditions. Each family having the right to such a mortgage loan can use it only once.
Twenty-four out of 30 banks in the country, as well as 17 insurance companies [in total 21] and 14 appraisal organizations are the authorized banks of the Azerbaijan Mortgage and Credit Guarantee Fund CJSC.
(1.7 manats = 1 USD on April 18)