The ECHMB provide funds in advance for origination of mortgages by Primary Lenders domiciled in the Eastern Caribbean Currecy Union such as Commercial banks, Development Banks, Insurance Companies and Credit Unions (collectively referred to as "Primary Lenders")
The mortgages originated from the funds are subsequently sold to the ECHMB.
Benefits to accessing ECHMB’s Mortgage Credit Facility
* Primary lenders have an external low cost source of funds for financing growth in their mortgage loans portfolio
* Primary Lenders would generate additional income by earning a fee for continuing to service the mortgages.
To be an approved primary lender eligible to carry
out mortgage business with ECHMB, lending institutions such as Commercial Banks,
Development Banks, Insurance Companies, or Credit Unions, must conform with the
underwriting standards and eligibility criteria as follows:
Capitalisation – The primary lender must be adequately
capitalised. Capital adequacy shall be determined both in terms of an absolute amount of $3
million and a Capital to Asset Ratio of not less than 8% or leverage of 12.5 to 1.
The primary lender must be subject to regulations by an approved regulatory body.
Lenders require operational expertise and experience in loan underwriting and
administration. The primary lender must have at least three years satisfactory experience.
The primary lender shall undertake a commitment to improve and maintain
mortgage-underwriting standards via training.
The primary lender must agree to be submitted to periodic audits and reviews of
its mortgage underwriting process.
The primary lender must maintain proper mortgage security documentation and also
maintain a minimum delinquency ratio within its mortgage portfolio.