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The Bank administers the Government of
Jamaica Mortgage Insurance Programme. This programme has been in operation
since 1960 and operates under the provisions of law No. 26 of 1960. The Bank
has been administering the programme since 1973 and to date it has issued
policies with a total face value of in excess of $130 Million.
Under the provisions of the Mortgage
Insurance Act, the Bank can insure loans that are made by approved financial
institutions to the purchasers of :
- Residential dwellings
- Residential lots
- Commercial buildings
- Agricultural properties
Activities however, have been concentrated on
the insuring of loans that relate to the purchase of houses for residential
purposes. The Bank offers two classes of insurance coverage.
- The insuring of the entire loan.
- Insuring the upper portion of the loan
(i.e. the difference between 66 2/3% and 90%).
The Mortgage Insurance Programme has impacted
positively on both lenders and borrowers.
It has benefited lenders in the following
ways:
- The risk of default attendant on a
mortgage loan is transferred from the lender to the Bank
- Funds channeled into housing development
have been done with a greater feeling of investment security.
- Claims have been settled promptly.
- Mortgage instruments have been made more
secure and marketable.
The benefits to the burrowers have been:
- Lending terms (e.g. rate of interest &
repayment period) with respect to loans have been made more manageable.
- Down-payment on a house has been kept to a
minimum.
- The investment of funds in residential
dwellings as a result of the availability of insurance coverage has
enhanced the number of house purchasers.
- Maintenance of fair building standards.
Loans that are insured relate to houses that have been built in
conformity with approved and designated building standards.
A total of thirty-six (36) institutions
(approved Lenders) have been approved to do business with the Bank.
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