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Credit Availability, Eligibility Criteria & Underwriting

A.      Credit Availability:

§   Shareholders & non-shareholders /PMLs can obtain a mortgage refinance limit up to 100 times their participation in EMRC Capital with the exception of refinance under CBE initiative product for low & middle- income citizens, under normal rates as decided by ALCO.

§   Allow utilization above 100 times and up to 150 times their participation in EMRC Capital with an additional 0.25% above normal rates.

§   A PML's access to mortgage refinance is contingent upon:

-                     Maintaining creditworthiness according to EMRC lending criteria.

-                     Commitment to the applicable laws and their executive regulations.

-                     Execution of an appropriate mortgage refinance agreement.

-                     Adequate collateral coverage of the requested refinance as per the approved product program. However, on case by case basis, Chairman / MD/CEO & CRO jointly have the authority to reduce collateral coverage by 5% provided that the PML has a RR 3 and reduction not to go below the regulatory collateral coverage.

-                     Full recourse on the PML in case of any default on the underlying mortgage loans.

§   Borrowing capacity is determined by the PML's ability to repay principal and interest, will be reviewed based on the minimum following factors:

-                     Capital adequacy.

-                     Availability of qualified collateral.

-                     Trends in operating ratios.

-                     Assets quality.

-                     Sufficient liquidity.

-                     Profitability.

-                     Management efficiency.

§     Prior to allowing utilization of a mortgage refinance limit, collateral analysis will be performed to ensure compliance with FRA's regulations and EMRC guidelines, and to verify the PML's collateral coverage integrity.

B.      Eligibility Criteria:

Loans refinanced by EMRC must meet the following eligibility criteria and any exceptions in the products program will supersede eligibility criteria:

1.                   Loans are for the purpose as per product requirement and purpose of units.

2.                   EMRC will accept first liens ONLY favor PML as required by the Executive regulations of Law 148 of year 2001 or as per FRA regulations i.e. registered mortgages or mortgage Loans eligible for registration.

3.                   At the time of refinance, in case of using weighted average maturity (WAM) maturity should not exceed the weighted average maturity of collateral.

4.                   Mortgages (used for initial refinancing) have been outstanding in PML records for at least 90 days to be waived under the following conditions:

§   PML collateral coverage must be maintained with no shortfalls within the past 3 months.

§   The PML should have at least one audited financial statement with a clean auditor report.

§   PML repayments should be current with no delays.

§   The PML must have a minimum outstanding Mortgage Finance loan portfolio of EGP 50Mn that have No Non Performing loans of delinquent clients with 3 or more delayed instalments.

§   LLP policy must be in line with FRA regulations at minimum.

5.                   At least one mortgage installment was due and was settled by investor (Initial Refinancing).

6.                   No payment is in default within the last 90 days.

7.                   Payments of mortgage loans Installments can be up to 6 months.

8.                   Maximum refinance loan to value (value being the lower of property price or appraised value) of 80%. Maximum PML LTV being regulatory percentage.

9.                   Collateral Coverage is calculated based on the unit value (value being the lower of property price or appraised value) with the following Drawing Power:

Units Up to 5mn  (residential & non- residential)


Unit Above 5mn & Up to 10mn (residential)


Units Above 5mn & Up to 15mn (non- residential)


Units Above 10mn residential


Units Above 15mn Non- residential


10.                The MD/ CEO together with CRO have the authority to accept up to 5% higher than approved LTV, on case by case basis subject to not exceeding the regulatory LTV.  

11.                EMRC does not accept mortgage collateral if an EMRC employee is the investor or guarantor.

12.                The value per loan does not exceed EGP 15 million and loans above 15 million to be presented on case by case basis to delegated authority for approval (Risk Committee).

13.                To the best knowledge of the Primary Mortgage Lender (PML), no bankruptcy proceedings have commenced against the Investor, and to the best knowledge of the PML the Investor is not deceased.

14.                Age of the Investor should not exceed 65 years during the life of the PML refinance Loan, in case Business as usual Investor exceeding 65 years old, life insurance to be mandatory and  case to be presented to Credit Committee for approval.

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