Mongolia to Cut Mortgage Rates to Support Middle Class Growth

Mongolia’s central bank plans to cut interest rates on mortgages by almost half to 8 percent from around 15 percent this month, following a new policy approved by the government to ease financial burdens on the middle class.

The new mortgages require a down payment of 10 percent to 30 percent and must be paid back in 20 years, the Bank of Mongolia’s Chief Economist Sandagdorj Bold said yesterday in a telephone interview. The loans are valid for apartments smaller than 80 square meters (861 square feet), qualified applicants must have a full-time job, and monthly payments cannot exceed 45 percent of the family income, he said. The policy goes into effect on June 17.