Mortgage market of Moldova developed significantly - experts

The experts of the Ministry of Economy and Commerce (MEC) state that the mortgage market of Moldova developed significantly lately, being based especially on the competition principles of the market economy. According to MEC report, the creditors’ number, providing credits under different conditions than standard ones – for terms longer than 10 years and interests lower than 14%, has increased. The majority of creditors accept only real guarantees, without any personal guaranty system, substantial deposit accounts, or by direct following of the salary and other methods of insurance often used on other mortgage markets at the starting development stage. Regarding the mortgage portfolios, the private creditors have reported only few violations or their lack, as well as the absence of non-payment cases, due to sudden increase of the goods value, especially in Chisinau, where the biggest part of the mortgage market is located. The statistic data made by the greater assets companies of Chisinau show that 60% of the potential buyers need a mortgage credit in order to buy the house they want. The creditors, governmental employees and regulation responsible persons, construction companies and assets agencies are convinced and optimistic concerning the mortgage credits, as there is an increased demand of mortgage credits on population’s behalf. According to the same report, the quick increase of the mortgage sector was possible in spite of the lack of a juridical framework well developed and coherent. The regulations of the mortgage sector are included now in the Law on Pledge, Law on Assets Cadastre, Civil Code, Civil Procedure Code, Execution Code and the others. MEC notes that lately many reforming measures were adopted, as well as registering of assets, implementing mortgage rights and pledging assets in light of certain guaranty agreements, and approving the Law on Mortgage in Moldova will solve the juridical problems, contribute to increasing the trust, transparency and access to mortgage financing system. At the same time, MEC considers that the Law will increase the interest for mortgage financing, show the state’s engagement in creating a solid base for ensuring the efficiency of the sector and will equal the chances of actors by ensuring loyal competitions between creditors.