Regulatory Alerts2015-02-26
Regulation on Mortgage Lending
The Central Bank of the Republic of Kosovo issued this regulation to establish minimum standards and requirements for mortgage loans secured by immovable properties across all licensed financial institutions. The framework mandates standardized written loan and mortgage agreements, classifies financing as residential or commercial, and imposes strict caps on qualifying residential mortgages including a fifty percent loan-to-income ratio, sixty percent debt-to-income limit, and eighty percent loan-to-value threshold. It further standardizes fixed and variable interest rate structures, prohibits negative amortization and balloon payments for qualifying loans, and defines permissible financing purposes such as purchase, refinancing, renovation, and construction.