Incentive policies on social housing for officials in Vietnam

1. Entities eligible for incentive policies on social housing in Vietnam

Pursuant to the provisions of Article 49 of the Law on Housing 2014, entities eligible for incentive policies on social housing in Vietnam include:

- People with meritorious services to the Resolution prescribed in law on preferential treatment for people with meritorious services to the Resolution;

- Households living in poverty or near poverty in rural areas;

- Households that are often affected by natural disasters or climate changes in rural areas;

- Individuals living in low income, poverty or near poverty in the urban areas;

…

- Officials and civil servants prescribed in law on officials and civil servants;

…

Thus, public employees belong to the group who are entitled to incentive policies on social housing.

2. Requirements for eligibility for incentive policies on social housing

Pursuant to the provisions of Clause 1, Article 51 of Vietnam's Law on Housing 2014, the requirements for eligibility for incentive policies on social housing include:

- They have not had any house under their homeownership, have not concluded any agreements on social housing purchase, lease, or lease purchase, have not benefited from any policy on housing or residential land support in any shape or form at the places where they live, study, or have houses under their homeownership, but the floor space per capita in the household is lower than the minimum space standard regulated by the Government in every period and every area;

- They are required to register permanent residence in the province where the social housing is located; if not, they are required to register temporary residence in that province for at least one year, except for cases prescribed in Clause 9 Article 49 of this Law;

- They are required to be not subject to regular income tax as prescribed in law on personal income tax; with respect to households living in poverty and near poverty, they must be subject to the households living in poverty and near poverty as prescribed in regulations of the Prime Minister. 

Thus, public employees must be people who do not have a house under their ownership, have not been able to buy a house, residential land, etc., who do not have to pay regular income tax have enough grounds to enjoy the policy of borrowing capital to buy social housing.

3. Procedures on application for loans

According to the provisions of Article 11 of Circular 25/2015/TT-NHNN, the procedures on application for loans are as follows:

Appointed credit institutions shall provide detailed instructions on procedures on application for loans as follows:

- Borrowers should prepare and deliver applications for loans to appointed credit institutions as prescribed.

- Based on applications for loans delivered by borrowers, credit institutions shall carry out assessment and make decisions on loans as prescribed hereof.

Credit institutions shall make public announcement of maximum time limit for decisions to be made on loans. In case a loan is declined, credit institutions shall make a written notice to the borrower on request.

- Loans made by appointed credit institutions to borrowers shall be made in a contract. The contract should specify information on loans made by credit institutions according to applicable regulations.

Thus, when applying for a policy loan to buy social housing, officials will prepare and send the loan documents to the designated credit institution where they want to borrow the loan documents according to the instructions. After that, the credit institution will verify and review the officer's information in order to make a loan, if not, the loan term will be publicly listed by the credit institution.

4. Responsibilities of officials applying for loans

According to the provisions of Article 14 of Circular 25/2015/TT-NHNN on the responsibilities of customers, as follows:

- Provide adequate, authentic information in relation to loans and take responsibility for accuracy of such information;

- Use loans purposefully and comply with terms and conditions of the credit contract and other commitments;

- Pay principals and interests to the bank according to signed credit contract.

- Use the loan for intended purposes; fully repay the loan principal and interest in accordance with the concluded credit contract; fulfill the commitments in the credit contract and comply with relevant regulations of law.

Thus, similar to other forms of loan at credit institutions, officials applying for loans must also fully repay the principal and interest on time to the bank according to the signed credit contract. In addition, after receiving the loan, the employee must use the loan for the right purpose and strictly comply with the agreed contents in the credit contract and commitments.

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