THE National Housing Trust (NHT) has been urged to implement a policy to assist people who are no longer able to sustain their mortgages due to ill health, age, and deteriorated socio-economic circumstances.

The call was made by members of the Public Administration and Appropriations Committee (PAAC) of Parliament at last week’s sitting of the PAAC at Gordon House.

“There are people for serious health reasons [who] will not be able to sustain a mortgage payment. There needs to be a different kind of consideration to treat with those persons. This is where collaboration with PATH and other social entities that deal with marginalised groups could come in,” committee chairman Edmund Bartlett said, after acting managing director of the NHT, Martin Miller, disclosed that the agency has now employed the services of debt collectors to deal with customers who have mounting arrears that are not income-loss related.

The trust reported to the committee that it has on its books arrears of 90 days and more, accounting for 19.7 per cent of its 103,902 mortgages, with a value of $2 billion. Miller said the NHT’s practice has always been to “engage” the mortgagers as soon as the arrears reach 30 days. He said that in cases where people have lost their jobs or source of income, then there is a facility which allows them a 24-month moratorium.

“… If it’s a situation where it’s just your decision to treat something else as priority then we go through the process of trying to encourage you to do whatever is necessary to keep your house. Selling it to recover is a total last resort. We will go at length to work with you to ensure that when the decision is taken to go that route, that we have no other option,” Miller said

But recently the NHT has introduced the use of debt collectors to recoup outstanding mortgage payments.

“That is something that is in the early stages. What we intend to do is assess it,” Martin told the committee.

Government member Fitz Jackson said while the NHT has chosen to go that route to deal with arrears, the economic realities of many Jamaicans must be taken into account. He said scaring mortgagers, particularly those in lower socio-economic circumstances, with legal action, could seriously affect them. “I would feel a bit more comfortable when it’s you (NHT) because you have an internal policy to try to accommodate and to treat with the circumstances,” he said.

In the meantime, Government member Raymond Pryce suggested that retired civil servants in particular, who have given most of their lives to national service, should be afforded some kind of reprieve. “So that you don’t have these retired police officers, nurses, teachers coming to constituency offices to their members of parliament for assistance, while still struggling with a mortgage for a unit that is sub-market value, and when you look at the life of the account, they have paid for that house over and over again. It is within our capacity to approach some form of gratuity arrangement for those retired civil servants,” he stated.

Pryce pointed out that for many of the housing schemes that were built decades ago, homeowners have been so focused on paying their mortgages that they have not had an opportunity to improve on the properties, which have severely depreciated as a result. He said this has left many such still paying mortgages on homes which are now rundown and from which they cannot possibly make a profit if they were to sell.

The committee chairman then suggested that perhaps the NHT could facilitate these groups through grants, similar to the facility which is now extended to people who earn less than $10,000 per week, and who have been contributing to the Trust for more than 10 years, enabling them to access up to $1.2 million as a grant based on specified criteria.

Bartlett cautioned, however, that if the NHT finds that the cohort of persons who fall into this category is too large, some other formula would have to be found to assist them. “Whilst we make these points in terms of developing a social component to your collections programme, it is important that you recognise that you can’t do it if it is going to be at the detriment of the viability of the agency,” he stated.

Meanwhile, of its target collection of $22.7 billion for the fiscal year, the NHT has cleared $3.6 billion up to May. This is against a target of $3.7 billion. The NHT’s report to the committee further outlined that loan repayments are $200 million ahead of what was projected, inclusive of carry-over from the 2014/15 fiscal year.

Its loan disbursements, however, stand at $316 million behind target. Miller explained that this is due to a slowing down of loan take-ups for its build on own land programme, as well as construction. Additionally, contribution refunds are so far at $389 million versus the $469 million target. The managing director explained that most claims for refunds would have already come in during the first three months of the calendar year, hence a petering off of disbursements after that period.