Bank loans

Real Estate Bank Loans – Syria Report

Established in 1966 as a public institution, the Real Estate Bank of Syria finances various types of loans related to the purchase, renovation or restoration of real estate.

According to the bank’s 2021 financial statements, published in the Al Watan newspaper, the Real Estate Bank granted loans related to real estate as follows: 1,661 loans for restoration (ie for the repair of damage) with a total value of SYP 8.7 billion; 414 renovation loans (i.e. coating, clay, paint and electrical and sanitary installation) with a total value of SYP 2.6 billion; and 409 purchase loans with a total value of SYP 4.3 billion.

The Real Estate Bank’s website lists the types of loans it currently offers. The bank often changes the names of the loan categories according to their financial and legal needs. Sometimes high-ranking bank officials, in their official statements, confuse the titles of these loans.

The loans are differentiated by the conditions for obtaining them, the terms of payment and the borrowing ceilings. However, for all loans offered by the Real Estate Bank, the property, the object of the loan must be formally registered in the land register in a zoned area under the control of the regime. The land registry for this property should also be free of any issues related to documentation and subdivision.

As part of the loan process, the bank asks the borrower to provide a land registration statement, a copy of the building permit from the relevant municipality, a copy of the subdivision plan from the Directorate of Cadastral Affairs and a copy of the “general plan of the site” of the municipality. The bank also requires a certified declaration of income and a copy of the professional or commercial certificate of the applicant.

The applicant must obtain a number of guarantors working in the public sector, depending on the value of the loan. For example, a loan of SYP 5 million does not require a guarantor, while to receive a loan of SYP 20 million, the applicant must find at least two guarantors. The Real Estate Bank is currently considering eliminating this requirement if the applicant is able to obtain a real estate guarantee equivalent to 200% of the value of the loan.

For purchase loans, the bank provides loans up to a maximum of SYP 50 million to finance the purchase of real estate at an interest rate of 10.5% to be repaid within five years. The loan limit for “purchase and completion of a property with an unfinished structure” is also SYP 50 million, but interest is 11%, payable within 10 years. Finally, a housing construction loan has a ceiling of SYP 50 million, but with an interest rate of 11.5% and a repayment term of 15 years. In the cases mentioned above, the bank loan covers 60% of the value of the residential property, based on an appraisal by the bank’s experts. A self-employed or self-employed loan seeker must secure three guarantors working in the public sector.

Recent years have seen the Real Estate Bank introduce new types of loans to meet the restoration needs of war-damaged homes. These loans went through various iterations before the bank specified the following two types: “recompletion of residential property” and “reinforcement of damaged residential property”. Both have a cap of SYP 10 million.

There is also a unique type of loan offered by the Banque Immobilière: the purchase of residential property for people who have applied for so-called savings housing, one of the government social housing programs implemented by the General Housing Establishment (GHE). The loan is disbursed to the GHE account rather than the applicant’s account. The value of the loan is set at half of the estimated value of the housing granted under the housing program. The applicant must repay the loan to the Real Estate Bank within 15 years at an interest rate of 10.5-11.5%, depending on the length of the repayment period.

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