State-owned GH Bank's board has approved a 60-billion-baht loan allotment for the imminent 1-million-unit low-cost housing project to comply with the government's policy to encourage low-income earners, the elderly and first-time workers to own homes.
Of the 60 billion baht, 10 billion is project financing for property developers to build residential projects, of which at least 40% are to be sold at a price tag of up to 1 million baht per unit, with the remaining 50 billion to be for mortgages for budget homes, said GH Bank president Chatchai Sirimai.
The 10 billion baht in pre-financing carries an interest rate of 1.25 percentage points minus the minimum lending rate (MLR) for constructing low-cost houses, while property developers will be paid 0.75 percentage points minus MLR for units priced at more than 1 million baht, he said.
The bank's MLR stands at 6.25%.
Deputy Prime Minister Somkid Jatusripitak has instructed GH Bank to develop residential projects on a massive scale for low-income earners, young families and the elderly.
He said property developers would put up 270,000 residential units ready for inhabitants from the final quarter of this year or under construction plan until 2022, in the first phase of the housing scheme.
The National Housing Authority, under the second phase of the low-cost home project, will offer unsold residential units to state officials, while the joint investment housing project between the public and private sectors will be the third phase.
The 50 billion baht in mortgages will be provided to low-income earners, first-time workers, those building families and the elderly to buy or construct low-cost homes with prices not exceeding 1 million baht per unit.
Mr Chatchai said the mortgage will be split into two batches, one with a total value of 20 billion baht, to be offered to those earning up to 25,000 baht a month and another worth 30 billion baht for those with monthly income of more than 25,000 baht.
The bank will charge borrowers earning up to 25,000 baht 3% for the first five years, and 1 percentage point minus minimum retail rate (MRR) for those working at companies that have contracts with the bank and 0.75 percentage point minus MRR for general borrowers.
Based on the 3% interest rate for a loan of 1 million baht, borrowers are required to make payments of 3,800 baht a month.
Those who earn up to 25,000 baht will also be entitled to free appraisals and waived front-end and registration fees.
Borrowers earning more than 25,000 baht a month will be charged 3% for the first three years, and 1 percentage point minus MRR for those working at companies which have contracts with the bank and 0.75 percentage point minus MRR for general borrowers.
