As of 1 January 2023, a number of reforms entered into force concerning the ASP system: the maximum age limit for saving increased, the maximum amount of an ASP loan for a home purchased jointly by two people saving for a home was increased by 50 per cent, and the state guarantee for an ASP loan was increased. The State Treasury has updated the ASP sections on its website to correspond to the new regulations.
The aim of the ASP system is to encourage saving for a house and improve the possibilities of acquiring the first owner-occupied dwelling. The ASP system is free state aid consisting of several elements: a good interest rate and an additional interest rate for home savings, a lower interest rate for the ASP loan than for other first home loans, a government interest subsidy for ten years and a government guarantee for the ASP loan.
The State Treasury advises banks and home buyers on the application of ASP regulations to practise. The State Treasury has updated the ASP saving and ASP loans sections on its website and updated the frequently asked questions concerning the ASP system.
Interest rates increased rapidly in 2022, making the ASP system and the interest rate hedging included in the ASP loan particularly topical. The state pays an interest subsidy if the interest rate applied to the ASP loan exceeds 3.8 per cent.
“Especially as interest rates rise, ASP benefits the borrower well. The changes that have entered into force aim to improve the functionality of the ASP system and allow more and more people to save for and purchase their owner-occupied dwelling,” says Credit Manager Soile Karttunen.
A home purchased with an ASP loan must be used by you
From the beginning of 2023, a new task of the State Treasury is to monitor that the ASP interest subsidy loan is used for purposes specified in the legislation. With the ASP system, the government supports the acquisition of a first home. Therefore, the dwelling that is the object of the ASP loan must be used by the borrower.
A dwelling purchased with an ASP loan may, for a special reason, be rented for a maximum of two years. Rental for more than two years is not allowed even for justified reasons. The ASP loan will receive an interest subsidy for the first ten years, and when the interest subsidy ends, the restrictions on rental will also expire.
The supervisory task is also topical now that interest subsidies will be paid significantly more in 2023 than in many recent years. The State Treasury has added a new section on ASP monitoring onto its service website, describing the State Treasury’s procedure and the obligations of the borrower and the financial institutions. In practice, the ASP borrower must ensure that their address details are up to date, and the financial institution must ensure a regular, electronic transfer of information with the State Treasury. This way, monitoring can be carried out efficiently by utilising register data.
Read more: ASP saving and ASP loans