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Romania’s „First House” Program To Also Include Mortgaged Newly-Built Flats

Romania's Government will modify Thursday the guarantee contract for the "First House" with a provision to include in the program the newly-built apartments that are financed from loans and already mortgaged by their developers.
Romania’s
21 iul. 2009, 14:51, English

The decision was made during the Tuesday meeting of Prime Minister Emil Boc with the bank managers willing to participate in the "First House" program. The talks were attended by both the banks that already signed the convention and banks that delayed their entry to request additional information.
 
Raiffeisen Bank’s vice-president Razvan Munteanu said the bankers and the Premier also discussed about setting up an insurance for the respective dwellings and the way of recovering the money in case the owners fail to pay the installments.
 
"The guarantee is irrevocable," Munteanu said at the end of the meeting.
 
In its current form, the convention includes certain situation in which the guarantee is not paid.
 
According to Munteanu, the new changes brought to the guarantee contract will not modify the structure of the "First House" program.
 
The guarantee convention was signed by the Finance Ministry and the National Fund for Guaranteeing the Small- and Mid-Sized Enterprises, on one hand, and the representatives of the banks interested to participate in the program, on the other hand.
 
The Finance Ministry received offers for the “First House” program from 20 banks. The value of the offers submitted by the banks totaled EUR1.46 billion, higher than the maximum guarantee threshold of EUR1 billion set up by the government.
 
The guarantee will be granted to the people buying their first home and who did not previously benefit from a mortgage loan.