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Cover Story

Expats Can Get Mortgages Here

The Russian state-owned Agency for Mortgage Housing Lending, (AIZhK), a government attempt to establish a Fannie Mae type institution has actually financed a number of mortgages for expats through Uniastrum Bank in Moscow, since the bank opened an expatriate department in June last year. Uniastrum can arrange the mortgage for an apartment or a country house with a plot of land in any of the 24 regions in which it operates. A bank executive says Uniastrum can provide clients with the maximum length mortgage 27 years. She also said the borrower can pay off the loan after just six months without penalty. The rouble denominated loan commands a 14% fixed interest rate, which Yinkova says is low in Russia. Uniastrum provides, free of charge, an independent valuer to guarantee that you are not being overcharged. Uniastrum will give you an answer promptly, often within one day, but the processing through AIZhK can take another month.

According to the Hellevig, Klein & Usov law firm here are some anecdotal cases of some of its clients (as client information is considered confidential the identity of the parties has not been revealed). The first client purchased two apartments several months apart from one another. The first apartment he paid for in cash and then got a loan for 11 % from Raiffeisen bank. He then purchased the second apartment under the same conditions. Both apartment are investment properties in central Moscow and are rented out on a short term basis.

This client earns some of his income in Russia and some of it abroad. He arrived in Russia in 2004 and has no other assets in Russia. He has no residency permit; but has a work permit. He is married to a non-Russian wife.

The bank did not request any information about his assets or incomes from other countries.

In the second case, the client purchased an apartment in Russia and got a 12% loan from Gorodisky Hipotekny bank. He does not have a work permit, only a business visa; no residency permit. He has a Russian wife but does not have an income in Russia. He has shares in a business that has Russian accounts and Russian income. This is satisfactory for the bank.

In accordance with Hellevig, Klein & Usovs experience with its clients, well over half of its expat mortgage applicant clients have succeeded in obtaining mortgage financing.

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