The Cabinet on November 7 endorsed the bill concerning the implementation of the state program “First House” that provides preferential access to private individuals, especially young families, to home loans by partially guaranteeing these loans, IPN reports.

Under the bill, persons younger than 45 who do not own a home will be able to purchase private houses and apartments on Moldova’s territory that were finished and made available for occupancy before the submission of the application. Their price should not exceed 1million lei. The beneficiary must pay an initial installment of at least 10% of the price.

The loans for the “First House” will be provided by commercial banks. These will be repayable over 25 years, in Moldovan lei. The state will guarantee about 50% of the balance of the released loan. The interest rate will consist of the average weighted interest rate on loans repayable in six to 12 months, communicated by the National Bank of Moldova, with a margin of up to 3%, and an annual guarantee commission of 0.5% of the balance of the state guarantee.

Another draft law approved by the Cabinet modifies particular state taxes on home loan contracts signed within the “First House” program. The state tax on the authentication of home purchase contracts is decreased from 0.5% to 0.1%, while the tax on the authentication of home loan contracts to 50 lei. It was also decided to reduce the honorariums of public notaries and bailiffs for measures taken with regard to property bought through the state program.

Both of the bills will be submitted to Parliament for adoption.

The annual state guarantee ceiling will be set yearly. The 2017 state budget envisions a guarantee fund of 15 million lei for home loans provided through the state program “First House”.