Iskan Loans: How Do they Work? Benefits Versus Conditions
The following information is provided by Bnooki.com that is a FREE online platform that gathers data related to financial products and services offered by banks and financial institutions in Lebanon.
The Public Corporation for Housing (PCH) provides long-term home loans in LBP, known as Iskan loans. The loan could cover: construction of a house, renovation of an apartment, or acquisition of a home. The allowed loan period ranges between a minimum of 10 years and a maximum of 30 years for buying apartments. The chosen period is evenly split into two phases:
Phase 1 where you pay the principal loan amount, excluding the interest, to your bank via equal monthly installments.
Phase 2 where you pay the interest for the Public Corporation for Housing.
The interest rate is fixed for 2 years and reviewed according to fluctuations in the rate (of the 2-year Treasury Bill in LBP) plus 3.5%. Currently, the interest rate on a PCH-Iskan loan is 4.67%. Let’s say your loan is 270,000,000 L.L, the total summed regressive interest rate would equal 105,000,000 L.L minus the 10% down payment plus the change in treasury bill rate, which is modified every two years.The maximum allowed loan amount is 270,000,000 L.L for PCH-Iskan loans and the minimum down payment usually ranges between 10% and 20% of the loan amount (depending on the bank policy). Accordingly, the property will be mortgaged as collateral. The two main benefits of the Iskan loan are:
A lower interest rate compared to all other kinds of housing loans.
It is exempted from registration (flat 5.7%), mortgage (flat 1.1%), and stamp fees.
The bank requires a 1% file fee. Life insurance and fire insurance covering the plot are usually included in this loan.
Conditions and Requirements:
The beneficiary should be a Lebanese citizen for at least 10 years.
Employees in the public and private sector, self-employed workers, and owners are all eligible to apply for this loan.
Applicant must be above 21 years old upon submission and under 64 years old by the end of the loan period, and he/she is allowed to benefit only once from this loan program.
Monthly family income must be greater than 675,000 L.L and less than 6,750,000 L.L in order to be eligible to apply.
The purchased house area must be maximum 200 square meters and it should be at least 25 km far from other properties owned by the beneficiary.
The loan amount shouldn’t exceed 90% of the residence value and the monthly installments shouldn’t exceed a third of the family’s monthly income.
Check out the PCH-Iskan loan policy and details for each bank by clicking on Housing Loans, through bnooki.com.
You can also check bnooki.com to compare housing loans benefit from the team of experts that is available to help and provide you with the adequate housing loan advice free of charge.