Mortgages Backed Securities

The ECHMB lends money to Primary Lenders domiciled in the Eastern Caribbean Currency Union such as Commercial Banks, Development Banks, Insurance Companies and Credit Unions secured by a pool of residential mortgage.

The basics are:

  1. ECHMB purchase the pool of mortgage loans from Commercial Banks, Development Banks, Insurance Companies, or Credit Unions (“Primary Lenders”) at the weighted average interest rate of the pool of mortgages.
  2. The Primary Lenders are subsequent contracted to collect and remit to the ECHMB (via a Transfer and Paying Agent Agreement), the principal and interest payments from home owners.
  3. The Transaction is mutually exclusive to the ECHMB and the Primary Lender.
  4. As compensation for performing the service of transfer and paying agent, Primary lenders are paid a commission.

Benefits to Primary Lender of selling your mortgages to the ECHMB

Long-term loans are immediately converted to cash. This would provide the funds for Primary Lender to originate more mortgages.

 

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