Mortgage Corp. $80M in arrears
More than 1,000 Bahamians have defaulted on their loans with the Bahamas Mortgage Corporation (BMC), leaving it $80 million in the hole, according to BMC Chairman Dr. Duane Sands.
“One of the biggest challenges we have had is the incredible rate of delinquent mortgages,” said Dr. Sands yesterday on the sidelines of the groundbreaking ceremony for the Mackey Yard subdivision. “[The delinquency rate] was as high as 40 percent and is now down to about 38 percent, but that has seriously impaired the ability of the Mortgage Corporation to do what it is supposed to do and that is to loan low to middle income Bahamians funds to build homes.”
Prime Minister Hubert Ingraham also acknowledged the high delinquency rate at BMC and sent a message to the corporation and the Ministry of Housing to take better care when granting loans.
“I would therefore expect that greater efforts are made by the Mortgage Corporation and the Ministry of Housing to ensure that persons who are given mortgages are able to satisfy the basic requirement, because there’s no point of giving someone something that they can not afford to pay back,” Ingraham said.
“The mortgage delinquency rate is unacceptably high, unaffordable and unsustainable for the future.”
He said the Mortgage Corporation ought to insist that the minister of housing use money from the Mortgage Guarantee Fund to pay the corporation back for all delinquent mortgages that have been guaranteed by the Ministry of Housing.
“The reluctance or reticence in pursuing that is totally unacceptable.
The Mortgage Guarantee Fund has significant money in it to be able to repay monies for people who have defaulted,” Ingraham added.
Sands agreed with the prime minister that BMC has to take aggressive steps.
He said the corporation is considering all avenues as it attempts to get on a good footing.
Sands said the new executive management team is working to take the corporation from the “dismal” position it is in.
‘We have already made incredible headway,” he said. “What we have done is totally revamp the organization. We have bold new leadership and we have aggressively gone after every single process in the way the Mortgage Corporation does business.”
He added that the corporation is also taking a closer look at who it gives loans to.
Additionally, he said the corporation identifies opportunities to help people who are struggling with their mortgages. He said the BMC is helping to restructure the loans of those who are attempting to continue to pay.
However, Sands said the corporation is going after those who refuse to pay.
“So we’re actively looking at all legal options in a compassionate way to ensure that the Mortgage Corporation can live up to its mandate,” he said.
“We would prefer to identify a way to help every single one of those delinquent mortgages to become current, but if we are unable to do so then we have to be guided by the law which says there are certain remedies that the corporation can take.”