FOR THE PAST THREE YEARS or so, the Barbados Association of Retired Persons (BARP) committee on reverse mortgages has been working to present to Barbados a facility that would be one of the first in the Caribbean.
Sir Courtney Blackman, addressing Harrison College in a lecture on its 275th anniversary a few years ago, praised Barbados as a humane society. One of the findings of the last census may have been the rising number of our aged population.
One of BARP’s missions is to improve the lot of its members who all fall into the category of aged population.
It is continuously assessing its usefulness to these members as more and more of the elderly seek to benefit.
The complaint that people are asset-rich and cash-poor is not a surprising aspect at this time of increasing hardship. Although all recessions eventually come to an end, that is no consolation when food prices and other essential items in the cost of living impact on a diminishing income vis-à-vis runaway expenses. Therefore it has not been difficult for the BARP committee to sell this idea of reverse mortgages to the asset-rich and cash-poor.
The committee has now done all of its work, including bringing the message via town hall meetings and the various media to the whole of Barbados.
Overwhelming response
The response has been overwhelming, so much so that people are champing at the bit to see the facility as a reality.
It is up to the Government now to give the final approval to work that has absorbed some of the best professionals in Barbados – lawyers, solicitors, bankers, accountants, to name a few. What is also important is that approval would be in the interest of the government in providing a way to alleviate the difficult living strictures of many potential voters.
The response from the banks has been lukewarm. That has been expected in as much as most of them rely on an ultimate decision not made in Barbados. The outstanding exception has been Barbados National Bank.
Actually the committee is not surprised by the response of Canadian banks, but figure that where business is good, others will follow.
Overwhelming support has come from credit unions, who rightly regard it as a normal kind of facility. For young people they provide a forward mortgage because young people have no assets but have jobs; for the elderly they provide a reverse mortgage because the elderly have assets and limited monthly income, but do not work.
One thing that a reverse mortgage provides is independence from the state and from one’s children yet still provides for one’s children, as title does not pass to the lender. This article does not seek to explain reverse mortgages, as the permutations are as wide or even wider than forward mortgages. The way a reverse mortgage is done depends on the arrangement between the borrower and the lender – it is so versatile and multi-dimensional. Perhaps that is why the credit unions that are noted for their flexibility have signed on to the idea.
You do not have to be a member of BARP to signal your desire to apply for a reverse mortgage. BARP will be at the forefront in helping institutions provide reverse mortgages to get the word out to the general public. Barbadians should ensure that Government representatives give urgent support to implementing the reverse mortgage in a timely fashion so as to help with these difficult days.
Minister Inniss, after raising the matter in the House of Assembly, gave a delegation from BARP a hearing and promised that all efforts would be made to expedite the amendments in legislation to facilitate reverse mortgages.
More questions may be answered at wildcoot70blogspot.com.
• Harry Russell is a banker.
