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The Bank provides funding to assist in the housing needs of low- and moderate-income households in Barbados through its Housing Credit Fund (HCF). The HCF was established by the Government of Barbados in 1982 to help alleviate the overall shortage of housing units across the island. The mandate remains to significantly improve the existing housing stock; assist in shifting the initiative for housing to the private sector and broaden the ownership base of housing in Barbados.
HCF resources are channeled through financial intermediaries and any other institutions approved by the Central Bank of Barbados.
The resources of the HCF can be used to provide financing for the following:
An approved financial institution can on-lend funds from the HCF to an applicant whose annual household income does not exceed BBD 51,000.00 or an amount determined by the Central Bank of Barbados.
Loan disbursements shall be based on an affordability formula in which no more than one-third of the gross household income of the applicant can be used to service the loan.
The financial institution should take such security from its client as it considers appropriate, since it carries the full credit risk of the loan.
The maximum maturity period of a loan to a beneficiary shall not exceed thirty (30) years for mortgages.
The maximum maturity period of a loan for home improvement purposes shall not exceed fifteen (15) years.
The term of the loan from the HCF to the financial institution is the same as that from the financial institution to the borrower.
The HCF’s lending rate to approved financial institutions shall be set by the Central Bank of Barbados. The rate shall take into consideration the prevailing interest rates for loans while at the same time ensuring that they are tailored to accommodate the low-income families.
The financial institution and the beneficiary are entitled to negotiate a rate of interest that is mutually acceptable to both parties.
The approved institution shall use normal underwriting procedures in assessing income, qualification and valuation of homes of beneficiaries.
The approved institution shall apply to the Advisory Committee of the HCF for disbursements from the HCF.
The application shall be supported by required documentation.
The approved institution shall give thirty (30) days’ notice to the HCF of the institution’s intention to drawdown HCF funds.
The Foreign Exchange and Export Credits Department
Central Bank of Barbados
Tom Adams Financial Centre
P.O. Box 1016 Bridgetown
Telephone: (246) 436-6870