Byblos Bank has revised the rates on loans for real estate renovation and construction
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Author
Saty Avagyan
Source
AFMTopic
Financial News, Byblos Bank Armenia
Byblos Bank has announced changes to its real estate loan terms. Effective April 25, 2025, the bank has adjusted both nominal and effective rates for its home construction and renovation loan programs.
The main changes are:
Real estate construction loan:
Nominal rate:
- Was: 12.25% to 13.25% per annum.
- Became: from 12.5% to 13.5% per annum.
The change is minor, just 0.25 percentage points up.
Effective rate:
- Was: from 13.15% to 18.9% per annum
- Became: from 13.42% to 22.45% p.a.
This is the key change - the upper limit of the effective rate increased by almost 3.5 percentage points.
Such an increase in the effective rate may be due to a change in the structure of commissions or additional costs of the loan. This markedly increases the overall cost of the loan for borrowers, especially on larger amounts and longer terms.
Real estate renovation loan:
Effective rate (maximum):
- Was: 19.02% per annum.
- Became: 18.62% per annum.
A slight decrease of 0.4 percentage points.
The reasons for the adjustment in repair loans were not officially explained by the bank. Perhaps it is due to changes in demand for this product or an internal policy of reviewing commissions.
What does this mean for borrowers?
- For those planning to build a house: it is worth studying the new offer carefully, as the increase in the effective interest rate may have a significant impact on the final overpayment of the loan.
- For those planning to renovate: the reduction in the interest rate, although small, is welcome as it reduces the total cost of the loan.
Before applying for a loan, it is essential to compare the effective rates, as they reflect the full cost of the loan, taking into account all expenses.
Do not overpay for the loan - use AFM to find the most favourable terms, taking into account all hidden charges.
To stay updated on other banking news and learn how to buy a house in Armenia, follow AFM updates.
