Vingroup, Techcombank propose social housing loan package with interest rate of 4.8%/year

Social housing project in Me Linh ( Hanoi ) - one of the few projects completed in recent years - Photo: NAM TRAN

The Ministry of Construction has just proposed to the Prime Minister to increase the loan term and lower the interest rate for social housing loans after Vingroup and Techcombank proposed a new preferential credit package for social housing with a loan interest rate of 4.8%/year and a loan term of 30 years.

Lower interest, longer loan terms

Previously, Vingroup Corporation and Vietnam Technological and Commercial Joint Stock Bank ( Techcombank ) jointly signed a document to the Ministry of Construction proposing a credit program for social housing buyers with lower interest rates and longer loan terms than the VND120,000 billion incentive package currently being implemented by four state-owned commercial banks.

Specifically, Vingroup and Techcombank proposed that the loan interest rate for social housing buyers be equal to the social housing loan interest rate currently offered by the Vietnam Bank for Social Policies in each period. Currently, this interest rate is about 4.8%/year and is fixed for the first 5 years.

The loan term is about 30 years, the collateral for social housing loans is social housing projects.

The loan subjects proposed by Vingroup and Techcombank are all individuals eligible to buy social housing according to the list verified and provided by the project investor.

The maximum loan for social housing purchase is up to 100% of the value of the social housing purchase contract.

And to implement this preferential loan program for buying social housing, Vingroup and Techcombank proposed that the State Bank consider granting additional credit growth limits compared to normal credit growth so that credit institutions can proactively expand their business to generate income to offset the interest rate difference spent to support people to buy social housing.

With the pilot program just proposed by Vingroup and Techcombank, the financial source to support interest rates for social housing buyers is about VND8,010 billion. Therefore, Techcombank proposed to consider granting additional credit limits for 5 years from the start of the pilot.

The Ministry of Construction added that the current 120,000 billion VND incentive package for social housing development has a loan interest rate of 7.5%/year for home buyers, and 8%/year for social housing project investors. The preferential loan interest rate is applied for 5 years. Every 6 months, the State Bank will adjust the loan interest rate once based on the average loan interest rate of four state-owned commercial banks.

Continue to lower interest rates on 120,000 billion VND package

The Ministry of Construction said that the proposal to pilot a new preferential loan package for borrowers to buy social housing by Vingroup and Techcombank has many similarities with the current VND120,000 billion loan package.

However, the interest rates, loan terms, and loan amounts are different, so the Ministry of Construction recommends that the Prime Minister direct the State Bank to encourage more commercial banks (in addition to the group of four state-owned commercial banks) to participate in the preferential loan package of VND120,000 billion.

Continue to consider increasing the preferential loan term and lowering the interest rate of the VND120,000 billion package to 3-5% lower than the normal loan interest rate so that workers and low-income people have the opportunity to borrow money to buy houses.

The Ministry of Construction also proposed that the Prime Minister assign the State Bank to study and decide on credit growth limits for banks participating in preferential loans for social housing purchases as proposed by Techcombank.

Source: https://tuoitre.vn/vingroup-techcombank-de-xuat-goi-vay-mua-nha-o-xa-hoi-lai-suat-4-8-nam-2024071618503321.htm