Mortgage conditions

Mortgage conditions

Mortgage conditions, requirements, persons entitled to a preferential mortgage and the necessary documents for obtaining a mortgage

Mortgage terms:

 

Conditions	Conventional mortgages	Preferential mortgages
Maximum amount	150,000 AZN	100,000 AZN
Maximum annual interest rate	8%	4%
Initial payment	20%	15%
Maximum term	25 il	30 il

 

Mortgages issued at the expense of the Mortgage and Credit Security Fund of the Republic of Azerbaijan must meet the following requirements:

 

1. The loan must be issued in Azerbaijani manats;
2. The loan must be issued to a citizen of the Azerbaijan Republic;
3. The loan must be issued for the purchase of residential property registered by the state;
4. A preferential mortgage must be issued for the purchase of residential premises that do not exceed the average market price in Baku, as well as in its settlements and villages, other cities and regions of the country, the price of which is calculated per 1 square meter of living space at the date of issuance of a preferential mortgage;
5. The amount of the preferential mortgage must not exceed 90% of the value of the mortgaged living space at the date of the loan, and the amount of the non-preferential mortgage must not exceed 85%;
6. The monthly amount payable on the mortgage must not exceed 70% of the total monthly income of the borrower (s). This requirement does not apply to cases where the amount of the mortgage is less than 60 percent of the value of the residential area in the primary market, loaded with mortgage at the date of the loan;
7. Regular payments related to the life and work of the borrower (borrowers) and his family may be at least 50 percent of the subsistence minimum established for each family member;
8. The age of the borrower (borrowers) within the statutory loan repayment period must not exceed the retirement age;
9. The loan must be secured by a residential mortgage;
10. The mortgaged living space must be assessed by an independent appraiser who is included in the list approved by the Mortgage and Credit Guarantee Fund of the Republic of Azerbaijan and has entered into a cooperation agreement with it;
11. The rights of the pledgee must be registered in the manner prescribed by law;
12. The principal and accrued interest on the loan must be repaid in equal monthly installments (annuity payments);
13. Based on the market value of the mortgaged real estate, it must be insured, provided that it is not less than the amount of the loan secured by the mortgage;
14. Life insurance contract. Life insurance of borrowers should be carried out in proportion to the share of their income when calculating the amount of their mortgage, and the total amount of life insurance of borrowers should not be less than the amount of the mortgage;
15. A person wishing to obtain a mortgage should not have current debt obligations;
16. The number of mortgage borrowers cannot exceed 3;
17. A person can act as a borrower only for 2 mortgages at a time;
18. Only close family members - spouses, brothers and sisters, children and parents, grandparents, can act as borrowers for the same mortgage;
19. Ownership of a residential area acquired through a mortgage can only be registered in the name of one of the borrowers;
20. Mortgages are issued for the purchase of individual houses, cottages and apartments located in apartment buildings built after January 1, 1970;
21. Unless otherwise provided by law, the alienation of residential space acquired through a mortgage is not allowed until the full fulfillment of mortgage obligations.
22. Part of the living space in shared ownership cannot be the subject of a separate mortgage.

The following persons are eligible for mortgage discounts:

• The following persons are family members

  • Shahid family member (husband / wife, children);

  • National hero (himself, husband / wife, children);

  • IDP or equivalent;

  • A person who has worked in the public service for at least 3 years, including those who have completed a special type of public service;

  • A person who has worked as a teacher in a public educational institution for at least 3 years;

  • The person with a degree of the doctor of philosophy;

  • Persons with special services in the field of sports (honorary physical culture and sports figure, laureate of national competitions (I place), laureate of international competitions (I, II or III place).

• The person with a doctor's degree;

• A person who has worked in the public service for at least 15 years, including a person who has completed a special type of public service;

• Servicemen of the Republic of Azerbaijan who have served in military service for at least 3 years (with the exception of military personnel doing military service), as well as those released from the reserve and resignation (Articles 41.0.6, 41.0.7 of the Law of the Republic of Azerbaijan 'On Military Service and Military Service') Except for military personnel released into the reserve or retired in the cases stipulated by Articles 41.0.8, 41.0.10, 42.0.3, 42.0.4 And 42.0.5);

• A person of special rank who has worked in the internal affairs bodies for at least 3 years;

• Researchers holding a scientific position for at least 3 years;

• A person who has worked as a teacher in a public educational institution for at least 15 years.

Note. A family or person who is eligible to use the concessional mortgage can only exercise this right once.

Required documents

• Documents required to obtain a mortgage

1. A document confirming the identity of the borrower (co-borrower) and a copy of the document. 2. Certificate of marriage (or divorce) (copy of the document). 3. Identity cards (copies of documents) of adult family members living with the borrower (co-borrower) 4. Identity cards or birth certificates (copies of documents) of minor family members of the borrower (co-borrower) 5. Borrower, joint borrower (copy of documents), employment contract or copy of employment record approved by the personnel department at the place of work. 6. Documents confirming the income of the borrower (co-borrower) (main and, if any, a certificate of additional employment, etc.). 7. Mortgage appraisal act.

• Documents required for registration of a mortgage

1. A document confirming the ownership of the mortgaged residential area (extract from the state register) and technical passport (if necessary). 2. A document confirming that the subject of the mortgage is not encumbered by other obligations and there are no restrictions. 3. Certificate of registration in the mortgaged residential area. 4. A copy of the consent of the spouse, other adult family members registered in the pledge, is subject to notarization for the subject of the pledge and extrajudicial sale of the pledged property. If the owner of the mortgaged property is a minor, a copy of the consent of the competent guardianship and guardianship authority is in the interests of the minor.

• Documents to be presented after the issuance of the mortgage

1. The original of the mortgage agreement (Mixed agreement) and mortgage paper and documents confirming their state registration. 2. Documents confirming insurance of the borrower against death and disability and the subject of the mortgage, as well as payment of insurance premiums. 3. A copy of the contract of purchase and sale of the purchased residential area. 4. A copy of the identity document of the seller of the residential area (for individuals).

• Additional documents must be submitted if the borrower is an individual entrepreneur

1. Certificate of registration of the entrepreneur with the tax authorities (copy). 2. Income tax or simplified tax return accepted by the tax authorities.

• Additional documents must be submitted if the borrower belongs to the privileged category

1. Document confirming that the borrower belongs to the privileged category.

Note: copies of the submitted documents must be notarized.

 

Source: Azerbaijan Mortgage and Credit Guarantee Fund

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