The ECHMB provides funds in advance for origination of mortgages by Primary Lenders domiciled in the Eastern Caribbean Currency 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.