The interest rate on loans granted under the First Home program has increased
The First Home program is becoming less attractive to citizens. According to the Organization for the Development of Entrepreneurship, in the last six months, only 50 young people applied for loans partially guaranteed by the state, compared to 500 applications registered in the first half of 2022. The loans have become too expensive, the beneficiaries say. The government says it will continue to offer compensation, but has yet to provide details.
On July 1, 2022, the interest rate on loans contracted by citizens under the First Home Program has almost doubled, up to 12.72%. Since January, banks have increased interest rates by another two percentage points. Some of the beneficiaries of the program say that it is difficult for them to pay twice the initial monthly interest.
"In July, I found out that I don't have any kind of compensation, my amount had increased from the initial amount, I had to pay more than I was paying, by a thousand lei. Now, since January I received a letter from the bank that this rate has increased again, and by one thousand lei. At the moment, the final amount I have to pay is twice as much as it was initially", said Natalia Bzovaia.
The number of beneficiaries of the first house program decreased significantly in the second half of last year, due to the increase in the loan rate, claims the representative of the Organization for the Development of Entrepreneurship, Vadim Indoitu. He mentions, in this sense, the need to continue programs to support the population.
"When the acquisition rate increases suddenly, for families, it can lead to the risk of the non-execution of the state guarantee and the loss of the home by the beneficiary of the program, respectively, these compensations come to support the active beneficiary, and the fact that we only have four executed guarantees, in this time means that the interest rate compensation mechanism was quite good and it is important that they continue in the following year to reduce the burden of the increases on the beneficiaries of the program," concluded Vadim Indoitu.
Radio Moldova recalls that in the middle of last year, the Government allocated 42 million lei from the reserve fund to cover part of the increase in interest on loans for the beneficiaries of the First Home program. In December, Prime Minister Natalia Gavrilița announced that in 2023 the Government will offset the interest rate increase by 0.62%, but no other details are known.
The "Prima Casa" state program was launched in March 2018. Based on this program, almost 8,100 homes have been purchased so far.
