Economy
Posted:
3 years ago
How Government’s Co-Funding May Change Mortgage Loan Interest Rates
Government of Georgia introduced the anti-crisis plan for real estate sector promotion. The program calls for providing a state co-funding component for mortgage loans for a period of 5 years. The co-funding coefficient on GEL-denominated mortgage loans is 4%.
Under the anti-crisis plan, the program’s budget is 70 million GEL and it will apply to only mortgage loans of about 200,000 GEL.
According to the National Bank of Georgia (NBG), in April 2020 mortgage loans interest rate made up 10.77%. Consequently, under the subsidization program, the new working rate will be 6.77%. However, the mortgage loans interest in USD and EUR is lower –7.15% and 4.31% respectively.