Recently, the Social Policy Bank (NHCSXH) issued Document No. 2526/NHCS-TDSV providing guidance on the preferential lending operations for purchasing, leasing social housing (NOXH), new construction, or renovation and repair of housing.
Article table of contents
from August 15, 2016, many people are eligible for preferential loans to buy, rent purchase social housing; construct new houses or renovate, repair houses for living with a loan interest rate of 4.8%/year, a minimum loan term of 15 years, and a maximum of no more than 25 years from the date of disbursement of the first loan. The document guides some of the notable contents as follows:
Borrowers exempt from income tax
Eligible borrowers include:
- People with meritorious services to the revolution according to the law on preferential treatment for people with meritorious services to the revolution;- Low-income earners, poor households, near-poor households in urban areas;- Workers working at enterprises inside and outside industrial zones;- Officers, non-commissioned officers with professional, technical expertise, professional soldiers, workers in agencies, units belonging to the People's Public Security and People's Army;- Officials and public employees according to the law on officials and public employees.
Borrowers must be exempt from regular personal income tax according to the law on personal income tax, except for people with meritorious services to the revolution according to the law on preferential treatment for people with meritorious services to the revolution; if they are poor and near-poor households, they must be categorized as poor, near-poor according to the regulations of the Prime Minister the Government of Vietnam.
5 Conditions for obtaining loans
The aforementioned borrowers must meet the following conditions:
- Save money monthly at NHCSXH (Vietnam Bank for Social Policies) for a minimum period of 12 months from the date of signing the Credit Agreement with NHCSXH. The monthly savings must be at least equal to the monthly repayment amount of the borrower;- Ensure to have at least 20% of the value of the purchase/rent-purchase contract for social housing for loans to buy/rent-purchase social housing; at least 30% of the estimated value or calculation of the cost for loans to construct new houses or renovate, repair houses for living;- Have adequate documentation proving the eligibility, housing status, residency conditions, and income to benefit from the social housing policy as prescribed;- Have sufficient income and repayment capacity as committed with NHCSXH;- Have a loan application to buy/rent-purchase social housing/to construct new/to renovate, repair houses for living, in which the individual and household members commit not to have benefited from preferential housing loans at other banks or financial institutions.
The home buyer must have a contract to purchase, rent-purchase social housing with the investor of the project that is on the list of social housing construction projects under the social housing investment program approved by the competent authority.
In the case of borrowing to construct new or renovate, repair houses for living, it is necessary to have: Land use right certificate, house ownership, and other assets attached to the land where the permanent residence is registered, issued by a competent state agency according to the law on land; design, estimate, or cost calculation plan according to construction law.
Additionally, the document guides that the maximum loan term is 25 years, the maximum loan amount for purchasing, rent-purchasing social housing is 80% of the contract value for purchasing, rent-purchasing social housing. The loan interest rate is decided by the Prime Minister of the Government of Vietnam for each period. Until December 31, 2016, the loan interest rate is 4.8%/year according to Decision No. 1013/QD-TTg dated June 6, 2016, of the Prime Minister the Government of Vietnam.
