KredEx’s new guarantees encourage the purchase of housing in the countryside and lower self-financing for large families


As of 1 March, the conditions for housing loan guarantees granted by the State will change, and in rural areas with lower property values, it will now be possible to receive a guarantee of up to 80%. The conditions for loans for families with three or more children will also be improved, allowing loans to also be offered with 5% self-financing.

Triin Reinsalu
Triin Reinsalu

‘The aim of the new guarantee conditions is to alleviate the situation where people outside Tallinn, its surroundings, Tartu and Pärnu, and in areas with lower real estate prices, cannot get a loan secured by real estate,’ said Triin Reinsalu, Head of the Housing and Energy Efficiency Department of the KredEx and Enterprise Estonia joint organisation.

In large cities and in locations where the price per square metre of real estate is below EUR 500, loan applicants can apply for a state guarantee of up to 80%, with a maximum guarantee amount of EUR 80,000 per property. This means that the amount of the loan to be taken can be up to EUR 100,000. For a detailed list of excluded regions, please visit the KredEx website.

‘Many families who qualify for the KredEx state guarantee – young families and young professionals – often cannot get a loan from a bank to buy a home in rural areas today due to low real estate prices, i.e., the level of loan collateral. The new loan conditions aim to offer the possibility to purchase or renovate a home outside big cities, as well.’

Another important change in the loan guarantee conditions is a new measure aimed at offering loans with lower self-financing to families with many children, i.e., at least three children.

‘Under today’s conditions, a state-guaranteed loan can be granted with a minimum of ten per cent self-financing. The amendment lowers the minimum required rate for large families to five percent, in order to make it easier for large families to purchase a home of their own,’ said Triin Reinsalu.

Families with many children will still have to go to their local bank to get a loan with lower self-financing, but will now be able to apply for the loan with a state guarantee of up to 40%, and twice as low one-off self-financing cost than before.

Enterprise Estonia and KredEx have merged. The substantive merger of the organisations will be finalised this year; until then, all services will continue to be offered under the KredEx and Enterprise Estonia brands.