Financial institutions in Uzbekistan are promoting updated lending frameworks aimed at supposedly alleviating the monthly debt burden on local borrowers. Kapitalbank has reportedly launched a revised mortgage refinancing scheme, allowing customers to reduce their interest rates down to 21 percent per annum while extending repayment periods up to 10 years.

Under the newly announced parameters, individuals holding existing mortgages with rates ranging between 24 and 25 percent can transfer their debt to Kapitalbank. The initiative supposedly permits a maturity extension of up to 10 years, even if the borrower's previous loan only had six years remaining. The maximum loan amount available for this refinancing program is capped at 1 billion soms.

Eligibility is reportedly extended to resident individuals, including self-employed citizens within Uzbekistan. However, stringent prerequisites apply, mandating a spotless credit history and the absolute absence of overdue liabilities. Furthermore, the bank clarifies that the program is strictly restricted to residential mortgages and excludes subsidized loans originally issued through the Ministry of Economy and Finance.

The refinancing mechanism involves issuing a fresh loan to settle the borrower's existing debt with the original creditor, after which regular monthly annuity payments are routed through the new institution. Financial analysts advise caution, noting that failure to service debts on time could trigger unforeseen financial penalties and severely damage the borrower's credit rating.

Source: uznews.uz