Family Mortgage: How to Get the Best Deal Through the “Affordable Housing for Young Families” State Program

Buying a home is a major financial step — especially for young families who may not yet have significant savings or a stable high income. The good news is that since 2010, Armenia has implemented a state-backed program called “Affordable Housing for Young Families”, which makes mortgages significantly more affordable. This program offers substantial benefits specifically for young families — and in this guide, we’ll walk you through how it works.

The program offers two main types of support:

1. Interest rate subsidy — the government covers part of your mortgage interest, reducing your monthly payment and the total overpayment on the loan;
2. Loan amount subsidy — the government covers part of the loan principal. The interest rate stays the same, but the total amount you borrow from the bank is reduced compared to buying without the program.

In addition, the program offers an interest tax refund — allowing you to reclaim part of the income tax you’ve paid on mortgage interest.

This guide includes all key details about the program: who can participate, what conditions apply, what documents are required, how interest subsidies differ from loan amount subsidies, and how to use the program wisely to save money and get the best possible terms.

Option One: Interest Rate Subsidy

An interest rate subsidy means the government pays part of your mortgage interest — typically 2%, 3%, or 4%. You take out a mortgage as usual, but the state covers part of the rate on your behalf.

For example:

If your bank offers a mortgage at 9% per annum, and the government subsidizes 3%, you effectively pay only 6%.

Let's say you're buying an apartment priced at 20 million AMD, and you make a 10% down payment — that's 2 million AMD.

The mortgage loan amount is 18 million AMD.

At a 9% interest rate for 20 years:

1. Monthly payment ≈ 161,951 AMD
2. Total interest overpayment ≈ 20.87 million AMD

Now, if the government subsidizes 3%, your effective interest rate drops to 6%:

1. Monthly payment decreases to ≈ 128,958 AMD
2. Total interest overpayment drops to ≈ 12.95 million AMD

Savings: Over 7.9 million AMD — just from the interest rate subsidy.

This is the ideal option for families who need to reduce their monthly financial burden.On our platform, you can also find out how much down payment is required for a mortgage in Armenia.

Option Two: Subsidy Toward the Property Value

This type of support assumes the government immediately covers part of your principal loan amount — meaning you borrow less from the bank than you would without state assistance. The interest rate remains standard, but the loan amount is reduced.

Let’s say the apartment costs 20 million AMD, and you pay a 10% down payment — 2 million AMD.

The government provides a subsidy of 1 million AMD (a realistic maximum under the current program for most eligible categories).

Then the loan amount becomes:

20 million – 2 million (down payment) – 1 million (subsidy) = 17 million AMD

At an interest rate of 9% for 20 years:

1. Monthly payment ≈ 152,953 AMD
2. Total interest overpayment ≈ 19.71 million AMD
3. Savings compared to an 18 million AMD loan ≈ 1.16 million AMD

This option is best for those who want to reduce their total interest costs and repay the loan faster while keeping the monthly payment manageable.

Best suited for borrowers who:

1. Want to repay the mortgage sooner
2. Aim to reduce total interest overpayment
3. Prefer to keep monthly payments the same, but shorten the loan term

Important: The loan amount subsidy is a one-time benefit, but its effect lasts throughout the entire loan term.

Comparison of Support Options (Apartment Price: 20 million AMD, 10% Down Payment)

As shown in the table:

1. Loan amount subsidy brings the largest total savings
2. Interest rate subsidy offers lower monthly payments

Your best option depends on your financial priorities: whether you want to minimize monthly outflow or pay off the loan faster.

You can use the mortgage calculator on AFM to find the optimal scenario for your needs.

Subsidy Amount Under the “Affordable Housing for Young Families” Program

The amount of financial support depends on the family category and may vary. Below are approximate subsidy limits valid as of 2025:

Note: The exact subsidy amount is determined by the bank and the authorized state body at the time of application. It may vary depending on the region, type of property (new construction vs. resale), and available program budget.

Before applying, be sure to use the mortgage calculator on AFM to estimate your loan amount with potential government support․ Also you can compare bank terms in the “Mortgage” section.

Program Guide: Who Can Participate and What Are the Benefits?

Who is eligible:

1. Married couples whose combined age does not exceed 70 years
2. Single parents under 35 years old with at least one child

Key Program Conditions

Why Is This Program Beneficial?

1. Save up to hundreds of thousands of AMD per year in interest
2. Lower monthly mortgage payments, making housing more affordable
3. Extra benefit for new builds: get a refund on paid interest through personal income tax
4. No large savings needed: down payment starts from just 10%

Is the Program Time-Limited?

As of the time of publication, the “Affordable Housing for Young Families” program remains active.

It was initially approved by Decree No. 98-N dated January 29, 2010, and has been regularly extended, with periodic updates to its conditions.

However:

1. The program has a limited budget — applications are accepted until the funding cap is reached
2. Conditions may change over time, especially in response to fluctuations in the refinancing rate

How to Use the Program: Step-by-Step Guide

1. Check your eligibility
2. Age, family status, citizenship
3. Choose a property within budget
4. Up to 27.75 million AMD (new construction)
5. Up to 25 million AMD (resale)
6. Select a participating bank
7. Check interest rate conditions and program partnership status via AFM
8. Apply at the bank
9. Submit your documents (passport, income proof, family status)
10. Finalize the mortgage with the subsidized rate
11. For new construction: apply for an income tax refund on interest payments

Required Documents and Participation Criteria

To apply for the “Affordable Housing for Young Families” program, you must meet certain criteria and provide the standard document package.

Main required documents:

1. Passports or ID cards of both spouses
2. Marriage certificate or a document confirming single-parent status
3. Child’s birth certificate (if applying as a single parent)
4. Income statement (for the last 6 months)
5. Employment record or employment contract
6. Tax payment details
7. Property documents (preliminary purchase agreement, valuation report, etc.)

Minimum Income Requirements

Your monthly income must be sufficient to cover the mortgage payment — based on the subsidized interest rate.

Most banks calculate this so that:

1. The monthly payment does not exceed 40–50% of the total family income

Example:

If your monthly payment is 120,000 AMD, your household income should be at least 250,000–300,000 AMD

The exact calculation depends on:

1. Loan amount
2. Interest rate
3. Loan term
4. Bank policy

That’s why it’s best to request a preliminary estimate from your bank or use the mortgage calculator on AFM.

Useful Tips and Lifehacks

1. Consider regional purchases — the 5.5% interest rate in the regions is more favorable than the 7.5% rate in Yerevan
2. Buying new construction = double benefit: interest subsidy + income tax refund
3. Insure the remaining 20% of the down payment if you don’t have the full 30% — it’s cheaper than saving the full amount
4. Use AFM calculators to estimate your savings and monthly payments in advance
5. Stay updated on program terms — changes can happen at any time

Program for Non-Residents and Diaspora Members: Can You Participate?

The state mortgage program is available only to Armenian citizens.

You may qualify if at least one spouse (or a single parent applicant) has Armenian citizenship and documented income in Armenia.

Alternatives for Diaspora and Non-Residents

There are alternative mortgage options from commercial banks for diaspora and foreign nationals.

Several banks — including ACBA, Ameriabank, and Unibank — offer mortgages for non-residents, provided that:

1. You have a stable income abroad
2. You are purchasing new construction or participating in an investment project
3. Your down payment is at least 30%
4. You can document the source of your funds

Note:

These offers are not part of the state program and are issued on commercial terms.

Conditions vary by bank, so it’s important to compare offers and request a personalized quote.

If you live outside Armenia and plan to purchase property back home, we recommend contacting banks that work with non-residents, such as ACBA, Ameriabank, and Unibank.

Use the AFM platform to explore mortgage solutions tailored to your situation.

When Can the Subsidy Be Revoked, and Will the End of the Program Affect Existing Loans?

Even if the “Affordable Housing for Young Families” state program is discontinued or suspended in the future, the terms of already signed mortgage agreements will remain unchanged.

If your subsidy has already been approved, it will continue for the full term specified — as long as you comply with all participation requirements.

However, a subsidy can be revoked early if certain rules are violated. This may happen in the following cases:

1. Breach of contract with the bank or the state program
2. Sale, gift, or transfer of ownership during the preferential period
3. Loss of eligibility, such as changes in family or social status, or relocation abroad
4. Providing false or misleading information in your application

To retain your subsidy, you must comply with all program and loan conditions — especially how the property is used.

Conclusion

The “Affordable Housing for Young Families” program allows you to choose between two types of support:

1. A subsidy on the interest rate
2. A subsidy on the loan principal

And if you're buying new construction, you may also claim an income tax refund for interest paid — potentially saving millions of AMD over the life of the loan.

Just imagine: instead of paying excess interest to the bank, you could spend that money on home renovations, your child’s education, or a family vacation.

Over 15–20 years, these savings could even amount to the cost of a second apartment.

Key Takeaways

1. You can participate even with a minimum down payment of 10%
2. The program is available throughout Armenia, including lower interest rates in the regions (from 5.5%)
3. Government support can be ongoing or one-time, depending on the subsidy type
4. Terms are subject to change — it’s important to stay informed

Share this article with friends and family — especially those considering buying a home in Armenia now or in the future.

You might help them solve their housing challenge for years to come.

To find the best mortgage tailored to the program — use AFM and get personalized recommendations without overpaying. You can also find the most favorable mortgage loans in Armenia on our platform — both with and without government programs.