“We have had major problems with buy-sell agreements. When we were mandated by the state to offer guarantees as part of this program, we were not told how important the 45-60 day period for pre-contracts is,” said Vasile Coman, Coordinating Director of the National Loan Guarantee Fund for Small and Medium-Sized Enterprises (FNGCIMM).
Representatives of the fund met with officials of the Romanian Banking Association (ARB) early this week to discuss optimizing the working procedures between lenders and the Fund, in order to speed up the process of granting loans through the “First Home” program. One of the main measures discussed with ARB was that lenders should advise clients to sign the pre-contract only after the financial institution confirms they are eligible.
“For the pre-contracts that are already signed, which are with the banks, lenders should submit the documentation to us at least ten days before the expiration of the agreement, so we have sufficient time to respond to clients. For future contracts, banks should make the eligibility evaluation, and only then request the applicant to sign a pre-contract within 45-60 days,” Coman said.
“First Home” is part of the Boc Cabinet anti-crisis program, and is meant to unblock the real estate market. People who want to take out loans through the “First Home” program will make a down payment of five percent for a home worth a maximum €60,000 or of €3,000 plus the difference resulting from the acquisition price, and the interest rate will be EURIBOR (Euro Interbank Offered Rate) on three months plus a maximum four percent per year, on euro loans, and ROBOR (the interest rate on loans on the Romanian interbank market) plus a maximum 2.5 percentage points.
