Energy Efficient Mortgages in USD

Security and Insurance

1. The residential property is pledged to the Bank (firm pledge) until the full repayment of the loan.
2. For residential property purchase loans the customer, hereafter also borrower, must have the ownership right to the residential property to be pledged.
3. If the loan is provided for purchase of residential property from primary market and it is under construction, (i.e. no Ownership Certificate is available for the property) the borrower will be asked to secure the loan by pledging any other privately owned residential property. Once the final Ownership Certificate of the completed residential property is issued it should be pledged to the Bank. All the documents related to and verifying the purchase of a new residential property should be submitted to the Bank for arranging pledge latest by the end of the 12th month.
4. Borrower must provide pledged property insurance opting from suggested list of insurers. The insurance policy should be reissued every year within the whole term of agreement. Should the borrower fail to arrange the insurance, the Bank will arrange insurance at the borrower's cost
5. Beneficiary rights of the insurance policy will be entitled to the borrower.
6. Insurance can be done either by full market value of the property or by loan amount upon borrower's discretion. If the property is insured for part of its value insurance compensation will be paid in the same proportion ratio of the sum insured and the property's full market value.
7. The Bank reserves the right to demand early repayment of the loan, if insurance terms of the pledged residential property specified in residential property mortgage agreement are breached.

Warning and important notes

1. 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.
2. If the borrower fails or regularly delays the loan repayment or any of obligations specified in loan agreement, the Bank reserves the right to repossess the pledged residential property, without recourse to the court and use the sales proceeds for full repayment of the loan outstanding amount.
3. In case if the value of such pledged residential property is not sufficient to cover the borrower's obligations, the obligations may be paid-off at the expense of the borrower's other property, in accordance with the RA legislation.
4. 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 3 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.
   You have a right to obtain your credit history from Credit Bureau free of charge once a year.
5. Fluctuation of foreign currency exchange rate may impact the loan repayment amount (for USD Loans). Interest for the loans with foreign currency can be paid either with the currency of the loan or in Armenian Drams as per customer’s preference and based on the provided respective instruction.
6. The Bank makes the decision on provision of loans at its discretion taking into consideration the conformity of the loan application to the announced requirements of the given loan type as well as evaluating such essential factors as the creditworthiness of the applicant, any overdue payments, liquidity of the pledged property and other factors.
   1. The Bank may require the customer’s obligations to be secured with guarantee at its discretion, based on risk assessment results.
7. Loan drawdown will be done after submission of pledge and insurance agreement / policy.
8. The loan will be transferred to customer's bank account.
   
9. The amount will be subsequently transferred to the seller’s account directly.
10. Valuation and security pledge expenses are born by the customer.
11. If the property prices in the market are demonstrating negative trend of 20% and more, the Bank may require additional re-evaluation of pledged property.
    
12. Bank does not compensate charges and fees applicable for documents and other transactions required for loan processing. All fees are paid by customer.
    
13. Floating nominal interest rate can be changed during the loan lifecycle no more than 2 times in a year. Maximum and minimum thresholds are set for the nominal interest rate of the loan, which cannot be exceeded during the lifecycle of the loan. In case of floating interests the maximum increase and decrease of the threshold of the nominal interest rate is defined as +/-7 interest point. The respective clause is mandatory part of the loan agreement.