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Kris An Charles offers home-deposit loans

Published:Sunday | August 10, 2014 | 8:00 AM
Gail Dixon (centre), general manager of Kris An Charles Investments Company. - File

Tameka Gordon, Business Reporter

Kris an Charles Investments Company Limited has rolled out a home-deposit loan product as it seeks to bolster its position in the microfinancing arena.

The company, which has set its sights on competing with the product offerings of the commercial banks and not just other microlenders, says it will further lend the entire mortgage amount to its clients, provided their salary can carry the repayment amount.

Kris An Charles General Manager Gail Dixon said the company polled its returning customers as well as those who accessed home improvement loans to inform the design of its home- deposit loan product. It was introduced in May to the company's "loyal customers" but is now being rolled out to other borrowers.

"The reason for extending the offer is based on the needs of the people that were polled. I think what we are finding in today's economy is that people are not really spending on those small material items but instead are trying to build assets and secure a future," Dixon told Sunday Business.

"So what we did was extend our offer to them first, so you would find a lot of our government institution employees have returned because they have a history of payback with us and we are able to lend them a larger amount," she said.

Kris An Charles has so far disbursed home-deposit loans to "at least 80 clients", she said, but declined to give details on the portfolio size, "because I don't want my competitors getting too much information".

The company is looking to "grow our portfolio by at least 10 to 15 per cent", she said.

Dixon said the microlender's market research showed that though customers were able to access mortgages through traditional mortgage lenders such as the National Housing Trust (NHT), "they are still void of that deposit that's is needed".

She said the company has not capped its loans amount but focuses on the ability of the clients to repay.

"If you look at Kingston where someone may be buying a $20-million house as opposed to a rural area where it may be a $5-million house, the amount for the deposit will differ but, in some cases, we may be able to give them the entire mortgage based on the salary if they are able to repay it," said the micro-finance executive.

"It is also based on salary, who can afford it and how much the property is actually (valued)."

Though collateral is required, especially for first-time applicants, Dixon said Kris An Charles assesses each case on individual merit and hedges the loan against the borrower's salary scale.

"They will need to show their pay slips. If they are getting the mortgage from the NHT or another mortgagor, we need to make sure their salary can still accommodate it because what you don't want to do is give them a deposit that will take $30,000 of their pay and now they have a mortgage that they have to pay and they can't afford it," she said.

tameka.gordon@gleanerjm.com