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Residential property purchase loan in AMD

Residential property purchase loan in AMD

Loan amount From AMD 5 million up to AMD 200 million2.
Loan terms1
  • 24-240 months with floating interest rate
Interest rate3

Floating annual interest rate is calculated at Bank’s AMD retail base rate plus constant margin and is currently equal to:


9% + 3% = 12%

9% + 2% = 11% for Plus and Status customers

Where: 

9% - Bank’s AMD Retail Base Rate

3% - Constant margin for purchase loans in AMD

2% - Constant margin for purchase loans in AMD for Plus and Status customers

Annual percentage rate starting from 12.96% up to 16.12%.

Annual percentage rate for Plus and Status customers starting from 11.82% up to 14.28%.


LOAN INTEREST AMOUNT IS BEING CALCULATED BASED ON THE ANNUAL NOMINAL INTEREST RATE, WHEREAS THE ANNUAL PERCENTAGE RATE OR APR INDICATES HOW MUCH WOULD LOAN COST TO BORROWER IN CASE OF REPAYMENT OF INTEREST AMOUNT AND OTHER PAYMENTS UNDER THE DEFINED TIMELINE AND TERMS.

 

Loan interest is calculated in the loan currency on a daily basis for 365 days and for 366 days in case of leap year on the loan outstanding balance.


LOAN INTEREST RATE CAN BE CHANGED IN CASE OF BANK’S AMD RETAIL BASE RATE CHANGE.
Loan to Value Ratio

Loan amount cannot exceed:

  • 90%, in case property is located in Yerevan and no additional property is pledged*
  • 90% of the purchased property value, in case if property is located in Yerevan and additional property in Armenia is pledged, provided total LTV ratio of two properties is maximum 75%. Respectively minimum prepayment amount that should be arranged by customer is 10%. Bank accepts only one additional property as a pledge
  • 75% of the purchased property value, in case if property is located in Yerevan, no additional property is pledged, respectively minimum prepayment amount is 25%.
  • 60% of the purchased property value, in case if located elsewhere in Armenia, in case if additional property in Armenia is pledged, respectively minimum prepayment amount is 40%.
  • 30% of the purchased property value, in case if located elsewhere in Armenia, no additional property is pledged, respectively minimum prepayment amount is 70%.
  • Loan amount is calculated based on the lower of the current market value as per the property valuation act and property purchase price.
*Required criteria
  • Residential property subject to purchase was constructed since Y2003 and is located in Yerevan and prospective suburbs
  • Borrower meets  PLUS or STATUS customer profile criteria and minimum  net monthly income is AMD 500,000. In case the loan is provided with existence of co-borrower monthly minimum combined net income cannot be less than AMD 600,000.
  • No interest rate segmentations are defined in this case
  • Max 50% debt to income ratio will apply, irrespective of net monthly income
Debt to Income Ratio
 The ratio of overall loan payments to net monthly income cannot exceed 60% if net monthly income is less than AMD 700,000 and 70%, if net monthly income is greater than or equal to AMD 700,000.
Loan provision fee (one-off)

1% of loan amount (0.5% for Plus and Status customers), maximum AMD 200,000.

Loan provision fee will be charged from the customer's account on loan provision day.

Residential property purchase loan in AMD

Loan amount Loan terms1
From AMD 5 million up to AMD 200 million2.
  • 24-240 months with floating interest rate
Loan amount Interest rate3
From AMD 5 million up to AMD 200 million2.

Floating annual interest rate is calculated at Bank’s AMD retail base rate plus constant margin and is currently equal to:


9% + 3% = 12%

9% + 2% = 11% for Plus and Status customers

Where: 

9% - Bank’s AMD Retail Base Rate

3% - Constant margin for purchase loans in AMD

2% - Constant margin for purchase loans in AMD for Plus and Status customers

Annual percentage rate starting from 12.96% up to 16.12%.

Annual percentage rate for Plus and Status customers starting from 11.82% up to 14.28%.


LOAN INTEREST AMOUNT IS BEING CALCULATED BASED ON THE ANNUAL NOMINAL INTEREST RATE, WHEREAS THE ANNUAL PERCENTAGE RATE OR APR INDICATES HOW MUCH WOULD LOAN COST TO BORROWER IN CASE OF REPAYMENT OF INTEREST AMOUNT AND OTHER PAYMENTS UNDER THE DEFINED TIMELINE AND TERMS.

 

Loan interest is calculated in the loan currency on a daily basis for 365 days and for 366 days in case of leap year on the loan outstanding balance.


LOAN INTEREST RATE CAN BE CHANGED IN CASE OF BANK’S AMD RETAIL BASE RATE CHANGE.
Loan amount Loan to Value Ratio
From AMD 5 million up to AMD 200 million2.

Loan amount cannot exceed:

  • 90%, in case property is located in Yerevan and no additional property is pledged*
  • 90% of the purchased property value, in case if property is located in Yerevan and additional property in Armenia is pledged, provided total LTV ratio of two properties is maximum 75%. Respectively minimum prepayment amount that should be arranged by customer is 10%. Bank accepts only one additional property as a pledge
  • 75% of the purchased property value, in case if property is located in Yerevan, no additional property is pledged, respectively minimum prepayment amount is 25%.
  • 60% of the purchased property value, in case if located elsewhere in Armenia, in case if additional property in Armenia is pledged, respectively minimum prepayment amount is 40%.
  • 30% of the purchased property value, in case if located elsewhere in Armenia, no additional property is pledged, respectively minimum prepayment amount is 70%.
  • Loan amount is calculated based on the lower of the current market value as per the property valuation act and property purchase price.
Loan amount *Required criteria
From AMD 5 million up to AMD 200 million2.
  • Residential property subject to purchase was constructed since Y2003 and is located in Yerevan and prospective suburbs
  • Borrower meets  PLUS or STATUS customer profile criteria and minimum  net monthly income is AMD 500,000. In case the loan is provided with existence of co-borrower monthly minimum combined net income cannot be less than AMD 600,000.
  • No interest rate segmentations are defined in this case
  • Max 50% debt to income ratio will apply, irrespective of net monthly income
Loan amount Debt to Income Ratio
From AMD 5 million up to AMD 200 million2. The ratio of overall loan payments to net monthly income cannot exceed 60% if net monthly income is less than AMD 700,000 and 70%, if net monthly income is greater than or equal to AMD 700,000.
Loan amount Loan provision fee (one-off)
From AMD 5 million up to AMD 200 million2.

1% of loan amount (0.5% for Plus and Status customers), maximum AMD 200,000.

Loan provision fee will be charged from the customer's account on loan provision day.

Please read loan Terms and Conditions before applying.

1 Customer's minimum age is 18. Customer's age plus the loan term should not exceed 65 years.

2 For facilities with 90% LTV ratio provided with no additional property pledged maximum loan facility is limited to AMD 100mln.

3 Depending on risk assessment results, loan application may be approved at a higher interest rate.

You are eligible to apply for a residential property purchase loan if you meet the below minimum criteria

Salaried account holders

  • You are an Armenian national or Armenian resident1

and

  • Have an account with HSBC Bank Armenia CJSC (hereafter the Bank) and at least 3 months employment with a company maintaining satisfactory banking relationship with the Bank, and your net monthly salary is at least AMD 200,000

or

  • Have an account with the Bank and at least 3 months employment with a company maintaining accounts with other banks in RA, and your net monthly salary is at least AMD 200,000. Salary should be transferred to your account with the Bank after loan drawdown (in case if prior salary transfer is not required by the Bank)2

or

  • Have an account with any other bank with at least 3 months employment history and salary being transferred to your account for 3 months, and your net monthly salary is at least AMD 250,000

Non-salaried account holders

  • You are an Armenian national or Armenian resident1

and

  • Have satisfactory account record and banking relationship with the Bank for a period of 3 months and more, and the last 3 months average monthly balance and average balance of the last month have been at least AMD 200,000 (or equivalent in other currency)

or

  • Have satisfactory account record and banking relationship with other local banks for a period of 3 months and more, and the last 3 months average monthly balance and average balance of the last month have been at least AMD 250,000 (or equivalent in other currency)

1 Persons with minimum 1 year of residence in Armenia proven by respective documents are considered as Armenian residents.

2 The requirements on salary transfer to your account with the Bank will be communicated to you during the loan approving process.

Loan repayment

The following repayment options are available for the borrowers:

  • Principal is repaid in equal monthly installments, while interest amount decreases with the repayment of a principal. Therefore, monthly repayments will decrease over the loan tenor.
  • Repayments are calculated on annuity basis, where both principal and interest monthly repayment amounts change over the loan tenor, while the total monthly repayment amount remains constant.

Your property may be repossessed in case you do not properly meet your loan obligations

If the borrower does not pay the interest and loan principal amounts in time, information about credit history will be submitted to the Central Bank of Armenia and ACRA Credit Reporting CJSC within three business days of credit facility overdue, resulting in negative impact on  borrower’s credit history, should the borrower decide to apply for another loan in the future. In case of existence the reporting is applicable for guarantors and co-borrowers as well.

Interest amount calculation

Interest amount will be calculated on a daily basis by using the following formula:

I = R*L/365, where

I = one day interest amount

R = current interest rate

L = outstanding amount of loan

Representative examples of interest amount calculation
Representative examples of interest amount calculation

Example 1. House purchase loan in AMD with annuity repayment type was provided to the customer.

  • Loan amount - AMD 25,000,000
  • Loan term - 120 months
  • Annual interest rate - 12%
  • Annual percentage rate - 13.30%
  • Days in a year - 365/366
  • Loan provision date - 01/03/2019
  • First repayment date - 01/04/2019
  • Loan full repayment date - 01/03/2029
  • Loan one-off provision fee - AMD 200,000
  • Monthly repayment amount AMD 358,677.37, out of which

Interest amount for the first month - AMD 254,794.52

Interest amount for the second month - AMD 245,550.74

Interest amount for the last month - AMD 3,577.92

Interest amount for the whole period of loan is AMD 18,074,857.98

Example 2. House purchase loan in AMD with Reducing repayment type was provided to the customer.

  • Loan amount - AMD 25,000,000
  • Loan term - 120 months
  • Annual interest rate - 12%
  • Annual percentage rate - 13.39%
  • Days in a year - 365/366
  • Loan provision date - 01/03/2019
  • First repayment date - 01/04/2019
  • Loan full repayment date - 01/03/2029
  • Loan one-off provision fee - AMD 200,000
  • Monthly repayments

Repayment for the first month - AMD 463,127.85, (out of which - interest amount AMD 254,794.52)

Repayment for the second month - AMD 452,853.88 (out of which - interest amount AMD 244,520.55)

Repayment for the last month - AMD 210,251.14 (out of which - interest amount AMD 1,917.81)

Interest amount for the whole period of loan is AMD 15,135,386.44

Example 1. House purchase loan in AMD with annuity repayment type was provided to the customer.
Loan amount - AMD 25,000,000
Loan term - 120 months
Annual interest rate - 15%
Days in a year - 365
Loan provision date - 21/10/2015
First repayment date - 21/11/2015
Loan full repayment date - 21/10/2025
One-off service fee for the loan - AMD 100,000
Monthly repayment amount AMD 403,337.39, out of which
Interest amount for the first month - AMD 318,493.15
Interest amount for the second month - AMD 307,173.15
Interest amount for the last month - AMD 5,549.63
Interest amount for the whole period of loan is AMD 23,468,357.85
Example 2. House purchase loan in AMD with Reducing repayment type was provided to the customer.

Things you should know

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In case loan monthly repayments are not processed in line with the loan schedule and loan agreement and in case you do not properly meet your loan obligations, your property may be repossessed and you may be deprived of your rights over it.

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Last updated on: 16.12.21, 11:10

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