ARMENIAN DEPUTY MINISTER OF FINANCE PROMISES EASIER MORTGAGE CREDIT TERMS

News.am
18:16 / 08/19/2009

"The purport of the newly established Mortgage Fund is the Government’s
short-term measures aimed at opposing the economic crisis, doing so
in two directions – promoting both supply and demand," RA Deputy
Foreign Minister Vardan Aramyan told NEWS.am. "Promoting demand
alone and investing funds in the economy, with any supply lacking,
naturally means that the funds will be used for satisfying the demand
by means of import. But this system enables us to promote demand on
the real estate market as this is the secondary market that directs
initial capital to the construction sector," he said. "That is, if
the profitability or prices slump on the secondary market, suppliers
may encounter serious problems and terminate construction. But prices
fall because of low demand – purchasers are lacking. The lack of
purchaser is the result of lower incomes. Under the circumstances,
we are also trying to encourage purchasers," Aramyan said.

As to when the funds will be invested, he said that the RA Ministry
of Finance has transferred the funds to the Central Bank of Armenia
(CBA). So an answer to the question should be sought at the CBA or
at the Mortgage Fund. "I can only say that the process is starting
this September or October," Aramyan said.

Of interest are also credit terms. According to Aramyan, "business
will set the terms." A prepayment of 20 to 30 per cent will depend
on borrowers’ creditworthiness. "If a borrower has stable incomes,
he may make a very low prepayment or not make it at all," Aramyan
said. He stressed that credit terms at the Mortgage Fund will be
easier than before.