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Arawak Homes Touting Low Interest Rates for Mortgages

4/14/2015 9:38:01 AM

 

 In the Newspapers Today:

The greatest investment that one makes is an investment in a home or real estate.  In the early 2000’s the housing market reached its peak with interest rates as high as 10% and in some cases higher.  After the effects of the United Sates housing prices, the Bahamas’ economy along with its housing market suffered greatly, resulting in the inability of persons to afford and qualify for homes.  Today with record levels of delinquencies, banks have been forced to revisit their lending policies to regain their competitive edge. 

This has resulted in an interest rate war between financial institutions with interest rates being as low as 3.99%. Suddenly, this has created enormous opportunities for land owners seeking mortgages at internationally competitive rates.  The translation of this shift means that a person holding a mortgage of $200,000 since 2005 at an interest rate of 8.5% has a monthly payment of $1,610. If you secure a similar mortgage today with an average interest rate of even 5%, your monthly payment on $200,000 is $1,169.  This invariably provides opportunity for any person seeking a mortgage the greatest margin of return on their investment. 

This scenario is particularly more beneficial to land owners seeking a mortgage but maybe buried in consumer loans at high interest rates.  Alternatively, one may consider using the equity accrued in the land to consolidate consumer loans, thereby gaining the benefit of a low mortgage payment and/or rates which represents a difference of 11% on that consumer loan alone. 

According to Ms. Theus Fountain-Rolle, Home Consultant and Mortgage Specialist at Arawak Homes, whose background includes some 5 years with one of the largest lending institutions in the Bahamas, dealing specifically with mortgages, affirms that this is the best time for a select group of people.  The land or lot owner with consumer loans can now say, consumer loans are not a “killer” and that the equity in the land can definitely improve one’s financial situation.  She further comments that Bahamians need to act NOW while the interest rates are at an all-time low and take advantage of the incentives being offered at the various banks. 

Improving your current financial situation and securing a mortgage as an investment for yourself and your family is an opportunity that Bahamians need to embrace quickly and sensibly.  As the saying goes, “Why pay more when you have an opportunity to pay less?”  

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