Categorized | National News

Over 4,000 Delinquent Mortgages

There are over 4,000 mortgages in arrears over 90 days in the banking system, according to Chairman of the Clearing Banks Association (CBA), Nathaniel Beneby.

Mr. Beneby told The Bahama Journal that as of March 31, those arrears totaled over $500 million across all of the CBA banks, including the Royal Bank of Canada (RBC), Scotiabank and CIBC First Caribbean Bank among others.

“Some 76 per cent of CBA bank mortgages in arrears more than 90 days are secured by the owner of occupied properties,” he said.

“However, it is good to note that 86 per cent of defaulting borrowers remain living in their homes. Since the beginning of the economic recession in 2008, clearing banks have restructured over 1,300 mortgages totaling $466.4 million and will continue the restructuring process.”

He also said that in the period September 2012 to January 2013, the CBA banks restructured 384 facilities at a value of $58.4 million.

“This amount has increased to date,” he said.

“While homes may be currently advertised for sale, member banks are willing to work with clients at any time prior to a contract being signed, if circumstances change to allow a restructure of the mortgage. The CBA will continue to work with Bahamians with defaulting mortgages to help find the best possible resolution to each individual circumstance. Whenever feasible, the primary goal is to help people retain their homes, regain financial stability and re-establish their credit standing.”

Mr. Beneby also said the clearing banks continue to cooperate and collaborate with the Ministry of Finance and the Central Bank of The Bahamas on the Mortgage Relief Plan.

“This has been a matter of consultation by the government with the banks and it’s a work in progress,” he said.

“I would not characterise the programme as not working because if you think about the spirit of it and what it was intended to achieve, the way it was constructed the primary reason why more people were not assisted was simply because of the high unemployment. They didn’t have sufficient income to be able to meet the obligations based on the way the plan was initially designed.”

He said a number of Bahamians are still in their homes.

“They are not being thrown out in the streets and the banks have been working with people from the onset of the recession,” Mr. Beneby said.

“The government just wanted to see how else they could help and so the primary reason for people not qualifying for the plan is because of lack of income and unemployment.”

Recently, Prime Minister Perry Christie indicated on the floor of the House of Assembly that “four or five” struggling homeowners might benefit from the Mortgage Relief Plan.

The news came after Minister of State for Finance Michael Halkitis’ previous indication that no one qualified for the plan and the government was heading back to the drawing board.

However, Mr. Halkitis also said in the House this month that some people would qualify for the plan, though he did not give any specific numbers.

“Happily we have received a few cases where individuals look like they will be able to qualify, so that’s a good development,” he said at the time.

Mr. Halkitis also stressed that the Christie administration does not see the plan as a “failure” and is committed to helping homeowners who are faced with foreclosure.

Written by Jones Bahamas

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