Mortgage and Housing Project (Soft Mortgage Scheme)

The Mortgage and Housing Project (Soft Mortgage Scheme) provides mortgage finance for persons who have been evacuated and who wish to build a house in areas north of Belham. The Bank of Montserrat will be lending up to a maximum $120,000 for the construction of a house and up to $30,000 for the purchase of land on which to build. The duration of the loan can be up to twenty-five (25) years at an interest rate at around 8.5%. DFID will provide funding for a subsidy to the borrowers of both the house mortgage and the loan for the land, but the amount of the subsidy will depend on the level of housing need.

The eligibility criteria for the scheme are as follows:

1.  The applicants must have relocated from the areas south of Belham.
2.  Preference will be given to those residing in Montserrat and who are from the Exclusion Zone.
3. Applicants off island may apply but preference will be given to those on island.
4. Applicants cannot own another dwelling house in the north and the proposed residence must be used as the applicant’s principal place of residence.
5. Beneficiaries from other subsidized permanent housing schemes such as Materials Grants and Direct Build will be excluded.
6. Land on which the applicants wish to build must be clearly owned by the applicants or leased for a period equivalent to the life of the loan plus five years.
7. Gross household income must be between EC$2,000 and EC$6500 per month.
8. Cash in the Bank and other cash assets must not exceed than $50,000.

Applicant will need to sign a legal Grant Agreement stating that the subsidy or grant will be used in accordance with the objectives stated on application form.

Applicants must first obtain application forms from, and return completed forms to, the Housing Unit along with a job letter and planning permission from the Physical Planning Unit. The Soft Mortgage Committee will then decide on the level of subsidy based on the housing need.

There will be two types of loans available to applicants wishing to apply for the scheme.

1. Applicants requiring loan for construction of a house, will receive subsidy based on the identified need. The loan cannot be less than the level of subsidy. The subsidy plus the loan cannot exceed $120,000.

The following are the maximum subsidy levels for the construction of the house.

2. Applicants requiring an additional loan for purchasing land on which to build will also receive a subsidy based on the identified housing need. The subsidy will be based on 27% this loan. The loan for the land plus the subsidy cannot exceed $30,000.

The following are the maximum subsidy levels that may be given for the purchase of land and construction of the house.

3. Applicants who have previously obtained a loan to purchase the land on which they now intend to build may qualify for a loan to pay off the outstanding principle. In this case applicants will have to produce verifiable evidence that the loan was obtained after 1^st January 1996.

In this case the subsidy cannot exceed $8,100 (27% of the maximum loan allowed in this category).

1. The applicant returns the forms and other relevant documents to the Housing Unit where the information is verified and processed.

2. Eligible applicants will be submitted to the Soft Mortgage Scheme selection Committee (Comprising a representative each from the Housing Unit, Community Services Department, and the Montserrat Christian Council).
3. The Selection Committee makes decision and Housing Unit submits forms and recommendation to the Bank of Montserrat for the loan and subsidy amounts.
4. Bank of Montserrat will further process the applications and notify applicant of result.