The Nassau Guardian
Govt still reviewing alternative mortgage relief plan
The Christie administration is currently examining an alternative proposal to its last mortgage relief plan, which fell far below expectations, Minister of State for Finance Michael Halkitis said yesterday.
Halkitis said the government plans to make the proposal public after a period of review.
“As you know, we did [have a] go at it,” Halkitis said, referring to the prior plan.
“It wasn't as successful as we thought it would be. We have gotten a subsequent proposal from the Clearing Banks Association so that we can see if, one, we can afford it and two, if this is something that would truly impact people.”
The previous plan which was projected to assist 1,100 homeowners, actually helped fewer than 10.
The government allocated $10 million for that plan in September 2012.
According to the government's figures, at the time, there were around 4,000 homeowners in arrears.
Until an alternative plan comes into effect, Halkitis said the government is hoping to provide homeowners with other forms of protection.
“We will be moving ahead very soon to bring into effect the [Homeowners] Protection Bill which will bring some relief and some protection to homeowners,” said Halkitis who spoke to reporters following a graduation ceremony at Holy Trinity Activities Centre. “So it is something that we are still looking at.”
The bill would give borrowers additional time to repay on defaulted loans through court intervention, in a bid to avoid foreclosure.
It would also allow a borrower to transfer a mortgage from one bank to another without having to pay stamp tax if the loan is under five years old.
Halkitis said the government will continue to work to fulfill its election promise to help struggling homeowners.
“We haven't given up on the process,” Halkitis said.
Included in the original plan were pledges to get local banks to agree to a 120-day moratorium on foreclosures and to write off 100 percent of unpaid interest and fees for those facing foreclosure.
As a part of that plan, the Progressive Liberal Party (PLP) also said it would encourage banks to reduce the interest rate on the mortgages in question to prime plus one percent.
The PLP pledged to guarantee interest payments for affected borrowers until 2017, if the banks agreed to their requests. However, these details were not included in the modified mortgage plan, which was later presented to Parliament.
Back in May 2013, CBA chairman Nathaniel Beneby Jr. said the high level of unemployment was the primary reason why more Bahamians did not qualify under the last plan.
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