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Cheap Housing Renovation Loans for Distressed Areas

Cheap Housing Renovation Loans for Distressed Areas Cheap Housing Renovation Loans for Distressed Areas

Bank Maskan, as the agent bank in the housing sector, is now offering loans for renovation of residential units in old parts of cities with an interest rate of 12% which, according to a top official with the Ministry of Roads and Urban Development, will considerably improve the reconstruction process in distressed areas.

"In order to provide the resources for these loans, Bank Maskan is utilizing 10 trillion rials ($263 million) from Mehr Housing Project's credit line in addition to 40 trillion rials ($1.05 billion) from the banking system," Mohammad Saeed Izadi was also quoted as saying by IBENA.

Earlier, the Ministry of Roads and Urban Development had announced that Bank Maskan would allocate one million loans during the current Iranian year (ending March 20, 2018) to jumpstart the stagnating housing market and provide people with cheaper loans to boost their purchasing power.

According to the ministry, 165,000 loans will be extended as construction loans while loans to purchase homes will number 186,000.

The deputy minister noted that the interest rate of renovation loans in distressed areas has been set at 12%, which is 6% lower than what Bank Maskan and other bodies charge for other loans.

Izadi added that the limit for the loans depends on the applicant's city and ranges from 300 million rials ($7,900) to 500 million rials ($13,150).

The government recently empowered Bank Maskan by adding 50 trillion rials ($1.33 billion) to its capital.

Roads and Urban Development Minister Abbas Akhoundi noted that in order to ensure that the bank does not face any shortage of funds in allocating loans, the ministry will add another 50 trillion rials to its capital in the foreseeable future.

Izadi noted that Bank Maskan has eliminated red tape for loan application and people can easily apply to get a loan through Bank Maskan's website.

 

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