Lower funds for Romania's First House state-backed lending program

The First House lending program backed by the Romanian state will continue in 2018. The state will offer some EUR 430 million worth of guarantees for mortgage loans approved under the program, the Government decided yesterday. The maximum interest margin participating banks can charge over the reference rate (ROBOR) went down from 2.5% to 2% to level up the total costs of all types of financing available under the program. Lenders have a week from when the new decision enters into force to send the state info on total costs for state-backed financing for new housing. The Government has also made some changes on how the un-allotted guarantees are re-allotted, as well as removed the use of a revolving value for guarantees. The state has granted over 236,000 guarantees worth RON 20.5 billion (EUR 4.4 billion) since launching the program in 2009. Based on these guarantees, local banks have granted loans worth over RON 41 billion (EUR 8.8 billion). Romanian state to gradually reduce the First House program editor@romania-insider.com