LAW OF THE REPUBLIC OF MOLDOVA

of December 21, 2017 No. 293

About some measures for implementation of the state program "First house"

The parliament adopts this organic law.

Article 1. Law purpose

The purpose of this law is creation of the legal base for implementation of the state program "First house" (further – the Program) and simplification of access for physical persons to acquisition of housing by the conclusion of agreements on the mortgage loans which are partially guaranteed by the state.

Article 2. Subject of the Program

(1) the Subject of the Program is housing in the form of apartments or individual apartment houses located in the territory of the Republic of Moldova.

(2) Housing specified in part (1), it shall be complete and put in operation about day of the request of the beneficiary of the Program for mortgage loan.

Article 3. Subjects of the Program

Subjects of the Program are:

a) the beneficiary – the physical person answering to the selection criteria provided by the Program and obtaining mortgage loan within the Program;

b) the creditor (financing bank) – the bank which obtained the license of National Bank of Moldova according to provisions of the current legislation and allowed to participation in the Program;

c) the guarantor – the Government on behalf of the Ministry of Finance which allocates public organization "Organization for Development of Entrepreneurship" (further – PU ORP) the right to issue guarantees from name and at the expense of the state for benefit of the creditor within the limits which are annually approved on these purposes by Parliament.

Article 4. Selection criteria of beneficiaries of the Program

(1) For receipt of mortgage loan within the Program the physical person shall correspond in total in total to the following criteria:

a) be citizen of the Republic of Moldova;

b) be resident of the Republic of Moldova in the value determined in Item 5) of article 5 of the Tax Code No. 1163/1997;

c) the beneficiary and/or his spouse / spouse shall have the official income gained in the Republic of Moldova for payment of mortgage loan. The ratio between monthly fee, plus interest rate and commission on guarantee, and total net income of the beneficiary and his relatives of the first degree of relationship and/or the spouse/spouse of the beneficiary who participate the income in repayment of mortgage loan as the co-debtor is calculated in compliance in rules of responsible crediting of National Bank of Moldova and cannot exceed 70 percent;

d) on the date of the request for mortgage loan the beneficiary or his spouse / spouse does not own housing as exclusive property or together with other family members or:

– owns no more than one housing, irrespective of method and date of its acquisition which living space less or is equal to 50 sq.m; or

– owns housing as exclusive property or together with other family members irrespective of its living space, located in the village or in the commune, the municipium of Chisinau which except for is in structure sat down also communes;

e) the beneficiary or his spouse / spouse acquired no more than one housing which living space is less by means of the Program earlier or is equal to 50 m 2, and completely extinguished the mortgage loan received on the basis of the agreement within the Program.

(2) for the purposes of this Article the spouses/spouse of the beneficiary and their children who did not reach 18-year age on the date of the request for the credit are considered as family members.

(3) the Beneficiary can use housing acquired within the program only for private use or for use together with members of the family and shall take permanent place residence in housing acquired through the Program before the expiration of payment of mortgage loan.

Article 5. Selection criteria of the financing banks

(1) Banks take part in the Program on voluntary basis.

(2) Any bank of the Republic of Moldova which obtained the license allowed to participation in the Program can grant mortgage loans to beneficiaries which answer the selection criteria provided by the Program.

(3) Criteria of the admission to participation in the Program are established by the Government.

(4) Banks take part in the Program after the conclusion them agreements on cooperation with PU ORP and the Ministry of Finance.

Article 6. Program conditions

(1) the Physical person answering to the selection criteria provided in Article 4, has the right to address for provision of mortgage loan within the Program provided that:

a) the purchase price of housing does not exceed two and a half million lei;

b) ceased to be valid;

c) the term of return of mortgage loan, except for its early payment, constitutes up to 30 years, but does not exceed the standard retirement age established by the legislation;

d) the mortgage loan is issued in national currency.

(2) In departure from provisions of the Law on credit agreements with consumers No. 202/2013 the maximum annual interest rate is expressed by the amount of the following components:

a) indicative rate for the Program published by National Bank of Moldova (calculated as weighted average interest rate on again attracted domestic currency deposits from 6 to 12 months of all on banking sector);

b) the maximum margin to 3 percent which is annually specified by the Government;

c) commissions on guarantee to 0,4 of annual interest rate of remaining balance of the state guarantee established by the Ministry of Finance. The commission on guarantee is reviewed at least every two years by the Ministry of Finance. The commission on guarantee is estimated monthly in the creditor (the financing bank) from the first day of issuance of credit to the beneficiary of the Program from remaining balance of the state guarantee and before complete loan repayment, and in case of execution of the state guarantee - before sale of mortgage housing.

(3) the Maximum annual interest rate is floating and PU ORP each half a year on its official web page is published. The interest rate applied to the period from July 1 to December 31 is based on Moldova published by National Bank to indicative rate for May, and the interest rate applied to the period from January 1 to June 30 – on Moldova published by National Bank to indicative rate for November of prior year. For granted loans increase in interest rate cannot exceed 4 percent points of times in 6 months, and within 12 months in a row cannot exceed 6 percent points. The corresponding rates are brought to the attention of the beneficiary of the credit in writing or electronically the financing bank within 10 calendar days before change of the maximum annual interest rate. Change of the maximum annual interest rate is obligatory for banks only in case of decrease in indicative rate.

(4) Banks has no right to levy the additional charges, except for unified commission in case of loan granting for covering of the legal expenses connected with documentation on the credit which size constitutes no more than one percent of cost of the credit.

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