Conditions for and amounts of concessional loans via Bank for Social Policies for purchasing social housing in Vietnam

Conditions for and amounts of concessional loans via Bank for Social Policies for purchasing social housing in Vietnam (Image from the Internet)

Eligible entities for concessional loans via Bank for Social Policies for purchasing social housing in Vietnam

Social housing is housing that receives state support for entities that are beneficiaries of housing support policies as stipulated by the Housing Law 2023.

According to Clause 5, Article 77 of the Housing Law 2023, the following entities are eligible for state concessional loans through the Social Policy Bank to purchase, lease-purchase social housing:

(1) Persons with meritorious services to the revolution, relatives of martyrs who are eligible for housing improvement support according to the Ordinance on Preferential Treatment of Persons with Meritorious Services to the Revolution.

(2) Poor households, near-poverty households in rural areas.

(3) Poor households, near-poverty households in rural areas in regions frequently affected by natural disasters, climate change.

(4) Poor households, near-poverty households in urban areas.

(5) Low-income individuals in urban areas.

(6) Workers, employees working at enterprises, cooperatives, union cooperatives inside and outside industrial zones.

(7) Officers, professional soldiers, non-commissioned officers of the people's armed forces, police workers, officials, and public defense employees on active duty; cryptographic personnel, other persons working in cryptographic organizations receiving a salary from the state budget.

(8) Officials and public employees under the law governing officials and public employees.

Note: Entities listed in (1), (4), (5), (6), (7), (8) are eligible for support in purchasing, lease-purchasing, renting social housing.

Based on local conditions, the provincial People's Committee may regulate support for the purchase, lease-purchase, and rental of social housing for entities (2) and (3).

For entity (7), concessional loans are provided to purchase or lease-purchase housing for the people's armed forces.

Conditions for concessional loans to purchase social housing in Vietnam

According to Article 48 of Decree 100/2024/ND-CP, entities must meet the following conditions to be eligible for concessional loans to purchase or lease-purchase social housing:

- Have a source of income and the ability to repay the loan as committed to the Social Policy Bank;

- Possess a loan application to purchase or lease-purchase social housing;

- Have a purchase or lease-purchase contract for social housing with the investor as stipulated by this Decree and housing laws;

- Ensure the loan with assets formed from the loan as stipulated by law. The Social Policy Bank, the investor, and the borrower must clearly define the management and handling methods of the secured assets in a tripartite contract.

Amounts of and terms for concessional loans to purchase social housing in Vietnam

Article 48 of Decree 100/2024/ND-CP stipulates that in the case of purchasing or lease-purchasing social housing, the maximum loan amount is 80% of the contract value.

The loan interest rate is equal to the interest rate for loans to poor households as determined by the Prime Minister of Vietnam in each period. The overdue debt interest rate is 130% of the loan interest rate.

The loan term is agreed upon by the bank and the customer based on the customer's repayment ability and shall not exceed 25 years from the date of the first loan disbursement.

Tran Trong Tin

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