"Great benefits" ... The initiative to solve the housing crisis in Iraq is more like "imagination."

[size=52]"Great benefits" ... The initiative to solve the housing crisis in Iraq is more like "imagination."[/size]

[size=45]It seems that the Central Bank’s initiative to end the housing crisis in Iraq is more like “imagination.” The administrative routine, the complicated instructions of government banks, the profits and burdens that commercial banks put in place, make the person who wants to obtain a loan to buy a housing unit think carefully before taking this step.[/size]
[size=45]Also, private banks are not in better condition than the government, most of which operate almost exclusively on currency auctions and lack credit.[/size]
[size=45]Hedge during loans[/size]
[size=45]The international expert and advisor to the National South Bank, Hisham Al-Shamali, said in a press statement, that “among the credit policies of banks, a loan cannot be granted to a person without his financial nature and his ability to repay known, so that there are guarantees for the bank,” indicating that “the borrower if He was an employee and his salary is not in a bank, so this means a clear indication that he obtained a loan from another bank.[/size]
[size=45]He added that “private banks are committed to the instructions of the Central Bank,” adding that at the same time, “the initiative announced by the Central Bank regarding a 15 million dinar loan is a non-binding initiative for financial institutions, and its cost to financial institutions is higher and there is no benefit to financial institutions. There is an adjustment in the exchange rate of the initiative’s currencies, and the private banks will reconsider this matter.[/size]
[size=45]On February 1, 2021, the Central Bank announced a new initiative by granting loans to employees whose salaries are domiciled in (government and private banks) at an amount of 15 million dinars, with a one-time fee of 4% of the loan value, and a payment period of 5 years.[/size]
[size=45]As well as loans in the amount of 125 million dinars for the purchase of housing units in residential investment complexes, and these loans will be interest-free, provided that a one-time administrative commission of 5% of the value of the loan is deducted with a repayment period not exceeding 20 years.[/size]
[size=45]The sponsor for the purpose of continuity[/size]
[size=45]A source in one of the government banks says that "lending citizens to buy housing units has hurt banks."[/size]
[size=45]The source, who requested anonymity, added that "banks took the initiative to grant loans to citizens to buy housing units in Basmaya and other complexes without a guarantor at the beginning, but many borrowers were reluctant to pay their debts."[/size]
[size=45]He adds that "the status of the guarantor as a condition for obtaining the loan came to preserve the continuity of the borrower by paying what he owes, and the bank continues to lend new citizens to obtain a housing unit."[/size]
[size=45]The source pointed out that "there are instructions that will be issued soon by the Council of Ministers regarding housing loans by establishing facilities for citizens to obtain housing units," acknowledging that "the interest placed on the loan by banks, amounting to 4 percent, is fixed for a period of 15 years."[/size]
[size=45]Freedom to determine interest[/size]
[size=45]For his part, Advisor to the Prime Minister Mazhar Muhammad Salih affirms that "Iraq after 2004 adopted financial liberalization by leaving the banks free to grant credit in any way without restriction and at the same time the freedom to set interest rates after they were before this date imposed on them."[/size]
[size=45]Saleh adds that "the central bank left its oversight according to ratios that do not threaten the bank’s financial liquidity or its safety," noting that "some banks had mismanagement of granting credit so that there were many defaulters and unknowns that exposed the banks to loss."[/size]
[size=45]He continues by saying, "The government cannot interfere with bank policy, whether loan or interest amounts," adding that "government intervention may be in development banks such as the real estate bank and the housing fund, in which the loan is low-cost and easy."[/size]
[size=45]A loan is a means, not an end[/size]
[size=45]Economic expert Dargham Muhammad Ali believes that “the loan is not an end, but a means if the elements of development are available to be employed in productive projects that reduce unemployment rates and perpetuate the capital cycle. Term".[/size]
[size=45]He adds that “the interest placed on the loan must be practically from the principal remaining in the borrower’s possession and not from the total loan principal because this is unfair and exploiting customers due to weak supply in exchange for growing demand for borrowing in light of the bad economic situation and weak housing supply in light of the rapid growth of the human mass “.[/size]
[size=45]Three initiatives without commitment[/size]
[size=45]A professor of political economy at the Iraqi University, Abd al-Rahman al-Mashhadani, says that “the central bank has undertaken three initiatives to encourage private banks to grant housing loans to citizens with little interest, but most of these banks do not adhere to this initiative,” indicating that “private banks are commercial banks that seek to achieve profits and thus. It does not grant housing loans. ”[/size]
[size=45]He adds that "the housing complexes sponsored by government banks to encourage vertical housing, which does not solve the problem of housing crisis in Iraq because we are talking about the need for four million housing units."[/size]
[size=45]Al-Mashhadani points out that "the simple loans that were granted by the banks distorted the cityscape because they were granted to areas up to 50 meters," considering that "the best solution to solve the housing crisis in Iraq is to allocate new cities."[/size]
[size=45]Are forced to take advantage of it[/size]
[size=45]Citizen Raed Al-Khafaji says that he “compelled to agree to the terms and fixed interest in order to obtain a loan from Al-Rafidain Bank to buy a housing unit in the Samaya Residential Complex,” indicating that “he currently lives in a rented house and does not have enough money to buy a house or even an apartment without obtaining the loan. “.[/size]
[size=45]He points out that "the loan that I got I will pay within 15 years with an amount that will be approximately half of the loan as interest," indicating that "government banks have turned into commercial banks like private banks in Iraq."[/size]
[size=45]For his part, citizen Ali Hamzah says that "the interest set by government banks is fixed and does not diminish by decreasing the amount of the loan after payment," stressing that "the citizen turns to these banks because there is no other alternative to obtain the loan."[/size]
[size=45]Hamzah notes that "most citizens are reluctant to come to obtain loans from banks for the high sums that he must pay afterwards," adding that at the same time, "there is no other option for the citizen to resort to in order to obtain a housing unit other than that."[/size]
[size=45]Iraq suffers from a stifling housing crisis due to the increasing population of Iraq and the limited housing complexes in addition to the citizen’s inability to build his own housing unit due to the high prices of land and construction materials.[/size]
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