VietNamNet Bridge – A number of homebuyers have benefited from the VND30-trillion low-cost home credit package launched by the Government, but it seems state employees have an advantage of accessing the low-interest loans.

An apartment building, part of it planned for conversion into low-cost housing, is seen in Binh Tan District, HCMC.

A homebuyer identified as M told the Daily that Bank for Investment and Development of Vietnam (BIDV) had approved his application for a VND600-million loan under the preferential lending program.

He has decided to buy a 69.3-square-meter apartment priced at VND14.9 million per square meter at the Khang Gia-Tan Huong project in HCMC’s Tan Phu District. This is one of the nine commercial housing projects eligible for the program.

Both M and his wife are university lecturers, with a combined income of over VND17 million a month. Thus, they can afford to buy the above apartment with a preferential loan interest rate of 6% per annum.

As M is working at a state university, where officials make asset declarations annually, it is favorable for him to have his housing status confirmed.

Loan applicants who are state employees just need to have their employers confirm whether they already have a home. Meanwhile, those who work for companies in other economic sectors than the state one may find it tough as they must seek a confirmation from ward-level authorities.

Another problem is the home purchase contract requirement. Banks want homebuyers to show their home buying contracts to take out a loan whereas homebuyers do not feel secure to sign the contracts with apartment developers without a bank loan being approved beforehand.

“It is a vicious cycle,” said M. He said he took risk when deciding to sign a home contract to complete his loan application.

For about one month, M had shuttled between the lender and the project owner to make the application complete. Eventually, he got VND600 million from BIDV, with a monthly installment of some VND8 million (principal and interest combined).

Also buying a Khang Gia-Tan Huong apartment, Hai in District 8 has been struggling with loan application procedures for over three weeks now. The biggest headache is he needs the authority of the ward where he is residing to confirm his housing status.

He worries he might lose his deposit of VND20 million on the apartment. He lives in a rented home at the moment.

Since the VND30-trillion home loan program was launched in early June, BIDV has approved only two loan applications. Meanwhile, at Vietcombank, six applicants have received the nod, with total loans of VND4.1 billion, said Nguyen Hoang Minh, deputy director of the central bank’s HCMC branch.

A senior source from a BIDV branch said many clients hit the wall when it came to seeking a confirmation from ward authorities.

“It’s hard to confirm if families have other houses than the one where they are staying. Who will be responsible for inaccurate confirmations? Therefore, many homebuyers have been unable to get a confirmation for their loan applications,” said the source.

For property firms in need of preferential loans, only VND9 trillion is available now, but many businesses want to borrow. In HCMC, the list of property developers eligible for loans is still awaiting the confirmation from the Department of Construction, and has yet to be issued to banks.

Banks will be caught in an awkward situation if the loan amount for corporate borrowers in the program runs out after they have signed loan agreements with enterprises.

Source: SGT