Changes have been made to the procedure for allocating mortgage loans and subsidies

A number of changes have been made to the procedure for allocating mortgage loans and subsidies.  This was stated in a decree signed today, 13 April, by the President of the Republic of Uzbekistan “On measures to implement the program of providing housing to the population through mortgage loans based on market principles in 2023.”

According to the decree, the formation of a modern and stable system of providing mortgage loans to individuals, targeted support by the state to families in need of improving housing conditions, attracting financial resources in local and international capital markets, and then refinancing them with mortgage loans, the goal of directing funding is provided.

The following changes were made to the procedure for allocating mortgage loans and subsidies:

•    Banks were allowed to issue mortgage loans to individuals without official income.  In this case, the solvency of these citizens is determined by taking into account their bank card turnover, rent, utility and other expenses;
•    Banks were given the right to set differentiated interest rates on loans based on the amount of the initial contribution, the duration of the grace period and other indicators.  In this case, the citizen who paid more initial contribution has the opportunity to get a cheaper loan;
•    In order to use the funds allocated to the subsidy faster, the validity period of the subsidy notification was reduced from 12 months to 4 months.  In this case, if the citizen cannot use the certificate in 4 months, he can re-apply for the subsidy;
•    The Ministry of Economy and Finance was given the right to directly cancel wrongly allocated subsidy certificates and stop payments based on the conclusion of People’s Welfare Commissions.

It should be recalled that on 5 April of this year, at the meeting devoted to the discussion of the mortgage program held under the chairmanship of the President, an additional 10 trillion soms was raised by issuing mortgage bonds, using the funds that should have been returned from mortgages on the balance sheets of commercial banks as assets.  It was said that resources could be involved.  It was also reported at the same meeting that from 1 May, people with insufficient official income will be able to get a mortgage loan.