Romanian Competition Council: "First Home" Program Doesn't Breach State Aid Rules

“Our inspectors collaborated on the “First Home” program since its beginning... From our point of view, everythink is OK,” Chiritoiu said.

He added the watchdog also investigated the selection method of the banks that will be involved in the program.

The Romanian Government published last Thursday in the Official Journal the methodological norms for the program and banks have a seven-day period to decide whether they agree to the lending terms set by the Government.

Thus, banks should send the Guarantee Fund for SMEs and the Finance Ministry, in a seven-day period, data on total financing costs and the estimated value of loans to be guaranteed under the program.

If the total value of the financing requested by the banks exceeds the EUR1 billion threshold set by the Government, the fund will agree with the Ministry of Finance upon reassigning the amounts, to encourage the banks with the best offers.

Thus, buyers of homes within the program must pay a 5% downpayment of the purchase price for a house whose price is lower or equal to EUR60,000, or a downpayment of EUR3,000 plus the difference if the price is higher than EUR60,000.

The guarantee will be granted to the people buying their first home and who did not previously benefit from a mortgage loan.

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