Residential property purchase loan in AMD

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Residential property purchase loan in AMD

Residential property purchase loan in AMD
Loan terms¹	From 24 months up to 240 months.
Loan amount	From AMD 2.5 million up to AMD 200 million².
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 criterias	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.
Interest rate³	Floating annual nominal interest rate is calculated at Bank's AMD base rate plus fixed Interest Rate Margin and it is currently equal to: 9.5% + 2.5% = 11%⁴ Where: 9.5% - Bank’s AMD Base Rate 1.5% - Fixed interest Rate Margin for purchase and renovation loans in AMD Annual percentage rate starting from 11.81% maximum up to 22.75% 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 BASE RATE CHANGE.
Loan account service fee (one off)⁵	AMD 100,000 if the loan amount is less than or equal to AMD 30 million. AMD 200,000 if the loan amount is more than AMD 30 million. Account service fee will be charged from the customer's account on loan provision day.

Residential property purchase loan in AMD
Loan terms¹	Loan amount
From 24 months up to 240 months.	From AMD 2.5 million up to AMD 200 million².

Loan terms¹	Loan to Value Ratio
From 24 months up to 240 months.	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 terms¹	*Required criterias
From 24 months up to 240 months.	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 terms¹	Debt to Income Ratio
From 24 months up to 240 months.	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 terms¹	Interest rate³
From 24 months up to 240 months.	Floating annual nominal interest rate is calculated at Bank's AMD base rate plus fixed Interest Rate Margin and it is currently equal to: 9.5% + 2.5% = 11%⁴ Where: 9.5% - Bank’s AMD Base Rate 1.5% - Fixed interest Rate Margin for purchase and renovation loans in AMD Annual percentage rate starting from 11.81% maximum up to 22.75% 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 BASE RATE CHANGE.

Loan terms¹	Loan account service fee (one off)⁵
From 24 months up to 240 months.	AMD 100,000 if the loan amount is less than or equal to AMD 30 million. AMD 200,000 if the loan amount is more than AMD 30 million. Account service 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.

⁴ Floating annual nominal interest rate for PLUS and STATUS customers is equal to 11% (9.5%+1.5%, where 9.5% is the Bank’s AMD Base Rate, 1.5% - fixed margin).

Annual percentage rate starting from 11.81% maximum up to 15.74%.

⁵ Not applicable for PLUS and STATUS customers

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

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

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)

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 after 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 - 13.16%
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
One-off service fee for the loan - AMD 100,000
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 - 13.23%
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
One-off service fee for the loan - AMD 100,000
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

Financial Directory (website in Armenian) This link will open in a new window

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.

Contact us

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Last updated on: 3/2/2020 07:14:33