FOLLOWING DISCUSSIONS with various Government agencies, the Barbados Association of Retired Persons (BARP) is expecting reverse mortgages to become available to elderly Barbadians as early as this year.
President Ed Bushell told the BARBADOS BUSINESS AUTHORITY that, based on the lobbying efforts of his association, along with a push by other sections of society, a law allowing this financial leverage could soon become a reality.
“That reverse mortgage will be available to Barbadians through the efforts of BARP in interaction with Government, the Ministry of Finance and other agencies,” he said.
A reverse mortgage is a financial mechanism in which the owner can access some of the equity – in cash – in that property. The leverage is seen as useful mainly to elders with fully paid-off houses who might be cash-strapped and who might be unable to raise money by other loans because of their retired status and the lending policies of financial organizations.
“We’ve received a lot of calls from our membership who are interested in reverse mortgages, some of whom are looking at it for various reasons, but some really desperately need cash,” Bushell said.
“They’ve got nice properties but they can’t go to the supermarket.”
He said moves were being made toward implementing the necessary supporting legislation. While acknowledging that progress could be slowed by the ongoing election campaign, Bushell said he was assured that any administration victorious at the polls would favour introduction of the necessary law.
Bushell and BARP’s executive secretary Elsa Webster pointed to the lobbying efforts for introduction of the reverse mortgage as an example of the association, which has about 35 700 members aged 50 and older, being more than just an old-age club or discount facility.
Webster also identified a cost-saving advantage to early enrolment in the association’s medical plan by soon-to-be-retired people.
BARP membership allows people to sign on to a private health scheme which covers a range of conditions except medical afflictions that existed prior to joining.
Noting that most chronic health conditions appear later in life, Bushell said there was an advantage in participating in the scheme early.
“People should not wait until 65 to join the medical scheme . . .because the older you get the more likely you are to contract something. If you joined at age 50, when you are a member of BARP no question of pre-conditions will arise at that stage,” he explained.
The BARP head also believes another financially prudent reason for people to join early, though still employed, is that their company’s medical coverage expires upon retirement. (GA)
