Bank employees

Housing Development Loan Program launched

Cabinet of Ministers on August 8 gave approval to implement the second phase of the program of lending for housing development. The purpose of the program – by increasing state support to make more available to certain categories of public loans for housing purchase, as well as to encourage renovation of apartment buildings.

The second phase of the program stipulates that the state guarantees would provide GAO Latvijas Hipoteku un zemes banka. Volume guarantee may not exceed 15 thousand lats or the equivalent in another currency, the guarantee is valid up to 10 years.

Bank bail (Hipoteku) may issue guarantees for taking credit in any registered in the Republic of Latvia credit or financial institutions operating with the permission of the Commission on Financial and Capital Markets and conclude an agreement with Latvijas Hipoteku un zemes banka.

The provision of guarantees is as follows. Tenants in denationalized homes or families with children can receive only one guarantee for the purchase or construction of housing. For the provision of guarantees made to the family Hipoteku banka one-time fee of 2,5% of the amount of sponsorship. Collateral (pledge) on the loan is purchased or constructed property.

To obtain a loan for renovation of apartment buildings bail amount can not exceed 1 thousand lats per apartment or 50 thousand lats at the house. Hipoteku banka, bank, extending credit, and borrower agree on the term of state guarantees. The fee for a guarantee of 2.6% per annum of the amount of bail, the borrowers are making it also in Hipoteku banka. In this case, the collateral for the loan is introduced by the tenants of the house fee.

The program provides for the allocation of 731 state guarantees totaling $ 4 million lats. 91 bail will be granted for renovation and reconstruction of apartment buildings, and another 640 in the amount of 2,4 million, would get in the flats to needy families.