Housing Minister: The draft decree-law on 'mortgage financing' aims to sustain the provision of decent housing for citizens

State Minister for Municipal Affairs and State Minister for Housing Affairs, Abdul Latif Al-Mutairi, stated that the draft decree-law concerning housing finance for beneficiaries of housing care, which the Cabinet approved at its meeting on Tuesday, aims to ensure the sustainable provision of dignified housing for Kuwaiti citizens.

In a statement to the Kuwait News Agency (KUNA) following the meeting, Minister Al-Mutairi added that the draft decree-law comprises 15 articles, noting that Article 2 defined the scope of its application and its validity for the purpose of purchasing a residential unit from a real estate developer in accordance with the provisions of Law No. (118) of 2023, as amended by Decree-Law No. (89) of 2025, or for building on a government plot allocated by the Public Authority for Housing Welfare, in accordance with the conditions and regulations set by the Authority for housing projects, whether completed or under implementation.

He pointed out that Article 3 of the draft decree-law specified the conditions for beneficiaries to qualify for subsidized housing finance, which include meeting the general conditions stipulated in the mortgage loan regulations issued by the Kuwait Credit Bank for the purposes of purchase or construction, and not having previously received housing care from the state.

Al-Mutairi mentioned that Article 4 outlined the provisions for subsidized and non-subsidized housing finance and the repayment mechanism, allowing for the combination of both in accordance with the controls and procedures established by the Central Bank of Kuwait.

He clarified that the same article stipulated that the beneficiary is responsible for repaying the principal of both subsidized and non-subsidized housing finance, as well as the interest or returns accruing on the non-subsidized finance, in accordance with the terms of the finance contract and Central Bank regulations, while noting that the state bears the cost of interest or returns on subsidized housing finance in accordance with the provisions of the aforementioned draft decree-law.

He noted that Article 5 specified that all housing finance must be repaid in equal monthly installments, with the repayment period not exceeding 25 years from the date of disbursement of the housing finance by the granting institution, in accordance with instructions and regulations set by the Central Bank.

He highlighted that Article 6 referred the procedures for disbursing housing finance for purchasing a residential unit from a real estate developer to the provisions of Law No. (118) of 2023 concerning the establishment of companies for the creation and economic development of cities or residential areas. The same article also stated that housing finance for the purpose of construction on a government plot allocated by the Authority would be disbursed in stages and in accordance with the rules established by the Central Bank.

He indicated that Article 7 outlined the obligation of finance-granting institutions to notify the beneficiary in case of failure to repay the housing finance provided by those institutions, in accordance with the provisions of the housing finance contract. It allowed these institutions, in such cases, to either reschedule the housing finance for a period not exceeding five years, in accordance with instructions from the Central Bank of Kuwait, provided that the beneficiary bears the repayment of interest or returns resulting from the rescheduling period.

The Minister stated that Article 8 obliged finance-granting institutions to register housing finance cases and submit related documents to the bank, including repayment schedules and default cases, in accordance with the instructions and regulations set by the Central Bank in this regard.

He added that Article 9 authorized the Kuwait Credit Bank to act on behalf of the State in signing contracts with financing providers, within the provisions of the draft decree-law and its executive regulations, and obliged the Ministry of Finance to pay the interest or returns accruing on subsidized housing finance to the Kuwait Credit Bank from the General Reserve Fund, which would then settle the amounts with the financing providers.

He clarified that Article 10 stipulated the Kuwait Credit Bank’s obligation, on behalf of the State, to the housing finance providers to repay the remaining balance of the subsidized housing finance in the event of a beneficiary’s default, while Article 11 specified that the Kuwait Credit Bank would obtain the mortgage in exchange for its commitment, on behalf of the State, to the housing finance providers to settle the remaining balance of the subsidized housing finance in case of beneficiary default, and that the mortgage would only be established through an official mortgage contract.

He noted that Article 12 granted the Kuwait Credit Bank or any entity designated by the competent minister the right to purchase all or part of the housing finance provided to beneficiaries by financing providers, while Article 13 obliged the Central Bank of Kuwait to issue the specific rules and regulations governing the granting of housing finance and determining the interest or returns applicable to non-subsidized finance.

He mentioned that Article 14 emphasized the necessity of issuing the executive regulations for the draft decree-law by decree, based on a proposal from the competent minister, within six months of its publication in the Official Gazette, while Article 15 specified that the provisions of the draft decree-law would apply to beneficiaries from the date the executive regulations are published in the Official Gazette.