Fri | Nov 22, 2019

NCB joins joint mortgage provider pool

Published:Sunday | January 21, 2018 | 12:00 AM

National Housing Trust, NHT, says the pool of private lenders under the Joint Finance Mortgage Programme has grown to seven with the addition of National Commercial Bank Jamaica Limited.

Jamaica's largest bank joined the pool of 'participating institutions' back in July 2017, but its partnership with NHT is just becoming public.

NCB told the Financial Gleaner the partnership allows it to offer bank customers 'one stop shopping' for its residential mortgage product, but would not say how large a slice of the market it is aiming to secure.

The bank is currently running a campaign that offers mortgages at promotional rate of 7.99 per cent, and a 50 per cent cut in commitment fees.

Mortgage lenders have been writing fewer mortgage loans, overall, according to the latest available data.

Planning Institute of Jamaica (PIOJ), which last issued data for the quarter ending June 2017, said the total value of mortgages for the period was down 10.6 per cent year on year to $9.2 billion. The agency said the lower value of mortgages was "due to a decrease in the value of disbursements by all institution categories", with the exception of life insurance companies, which also lend money for home acquisition. The numbers exclude disbursements by Jamaica Mortgage Bank Limited, which finances large development projects.

The total number of mortgages disbursed also fell by 89 to 2,013 loans in the June 2017 quarter.

Under the NHT's joint finance programme, applicants conduct all business through the lending institution, which in turn handles "the underwriting and loan servicing".

"The contributor gets his NHT-entitled amount at the applicable NHT interest rates. This is matched with whatever additional amounts the contributor borrows from the participating institution at its interest rate. Repayment is made to the participating institution," the state agency said. NHT rates range from zero to six per cent.

Alongside NCB, the other six joint finance partners are Victoria Mutual Building Society; CIBC FirstCaribbean Jamaica; Scotia Jamaica Building Society; Sagicor Bank, Sagicor Life Jamaica; and JN Bank.