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Money For Nothing: Mortgage Corp Borrowers – Half Won’T Pay Debt

Deputy Prime Minister Peter Turnquest in the House of Assembly. File Photo: Terrel W. Carey/Tribune Staff

Deputy Prime Minister Peter Turnquest in the House of Assembly. File Photo: Terrel W. Carey/Tribune Staff

By RASHAD ROLLE

Tribune Staff Reporter

rrolle@tribunemedia.net

AS he made an impassioned plea for Bahamians to take care of their financial obligations, Deputy Prime Minister and Minister of Finance Peter Turnquest said the Bahamas Mortgage Corporation is “insolvent” if it were not for the government’s guarantee of its debt, with 47 percent of its loans in arrears.

He was speaking in the House of Assembly yesterday during debate on a resolution to acquire a tract of land that would facilitate the relocation of the BMC.

The debate came against the backdrop of the BMC’s recent repossession of homes of people who have accumulated arrears for a number of years, a move the Progressive Liberal Party has condemned as “cruel”.

The number of loans being repaid right now to the BMC is 2889, 1366 of which are in arrears.

The value of the loans in arrears is more than $34m.

Mr Turnquest said the BMC is currently owed $194,246,667.

Meanwhile, it owes $395,026,146 to bondholders, including interest.

“When you say leave them in the house you have to understand that the loan is not going anywhere,” he said.

“That money is still going to be owed to these bondholders and at some point in 2018 we’re going to have to pay or the Bahamas Mortgage Corporation is going to have to pay and they don’t have the money. I’m sure the minister will tell you right now, they don’t have it.”

“The Bahamas Mortgage Corporation owes $162m and it has receivables out there of about $194m, not including the interest. In any other world, I’ll try to be careful with my words but there are no delicate ways to say it, that institution is probably insolvent, it is not a going concern. It only can operate the way it’s operating because the people of the Bahamas has guaranteed it. How do we stand here and say ‘man give them another year, you being cruel’ but at the same time say ‘you raise VAT to 12 percent, you killing the people.’ Where you think this money comes from? You think it just grows on tree?”

Opposition leader Philip “Brave” Davis noted during his speech that some people with arrears have fallen on hard times. Acknowledging this, Mr Turnquest said this does not absolve people of their responsibility to talk to their lenders about the financial difficulties.

“It is true to say some people have a change in circumstances,” he said. “It has happened to many, many Bahamians: death, loss of a job, divorce. Those persons who were honest about their intent, those who had a genuine wish to be upfront and to meet their commitment would’ve come into the Mortgage Corporation and they would’ve made arrangements for whatever circumstance that exists. What happens is, unfortunately, Bahamians when they get into trouble and they can’t pay for their mortgage or whatever the commitment is and the bank or the lending institution starts calling, they start ducking. They figure if I don’t talk to them, they don’t come to me, they don’t find me, they’ll eventually give up. I say to all Bahamians today, if you are in financial crisis or can see you will be in financial crises, go and see your lender. And the best time to see them is before there is a financial crisis because you have some workable situations. Ain’t no pride in this because ain’t nothing worse than saying to the family we gon’ lose our house because I ain’t pay my bill.”

“The minister for health spoke about the fact that the sinking fund that is supposed to fund the repayments of these loans has not been made, has not been consistent. In fact they’ve been raiding the fund, taking money out which is a big no, no. I don’t know how you do that but they been doing it. So the money doesn’t exist; $8m we will have to pay this year. Next year is $6m. Year after $6m; year after another $6m; year after another $6m. 2023 it’s $25.8m in the one year. That’s what we talking about. You can’t kick this can because it’s $395m. How far you gon’ kick that can? You gon’ hurt your toe because it ain’ gon’ move. It ain’ going nowhere. What we saying to the Bahamian people in this regard is this is a shared responsibility. We understand life events happen. But you got to do your part and a lot of people don’t understand that and a lot of us because of expediency, because it is easy to say, don’t worry about it; we got you for another six months, which turns into a year, which turns into another six years, which turns into 15 years. Meanwhile, clock ticking. This is not about being cruel, not about being irresponsible, not about being insensitive with the Bahamian people and those who are affected. This is about the shared responsibility and shared partnership between borrower and lender and each of us doing what we are obligated to do when we freely entered into this agreement.”

The BMC’s main bondholder is the National Insurance Board. Bahamian commercial banks, insurance companies, pension funds and other investors hold its bonds as well.

Comments

bogart 9 months, 2 weeks ago

2.5 billion dollare in VAT mismanaged by previous govt.....taxes mismanaged statium costs up to 42 million...water treatment plant 9 to 19 million...so much wastage at the top.....THEN PORE PEOPLE TAXED TO PAY FOR OTHER PEOPLE WASTAGE MISMANAGEMENT....SLACKNESS.....AN...AN...AN...rise in VAT across the board hurting the pore more than rich......COST OF LIVING UP 1.2%...last Central Bank Quarterly Report....2,500 let go by the govt.....merchants complaining business revenues down...for the Finance Minister to simply say the pore dont want to pay is astonishing....Mind you the wealthy can buy dity lowered AIRPLANES HELICOPTERS...PARTY DUTY lowerer.....why even CAVIAR dont now have VAT.....Duties reduced and merchants not even passing it on.....pore jus cant win fer losing ...even Haitian shanty town getting to live for free in shantytowns..studies census done.....

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truetruebahamian 9 months, 2 weeks ago

POOR is not rich. A Pore is something on your skin that allows you to sweat.

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Sickened 9 months, 2 weeks ago

Everywhere we look we see years and years and years of government waste, incompetence and graft. If we look too hard we may realize that we are simply land pirates (pirates without a boat).

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geostorm 9 months, 2 weeks ago

@sickened, that pretty much sums it up!

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ohdrap4 9 months, 2 weeks ago

that ain't working, that's the way you do it borrow money from the bmc money for nothing, and the house for free.

Repossess and sell them to the ones who applied for the land programme.

I have known lawyers who advise people not to pay condominium fees.

I have known accountants who advise people not to pay mortgages and that late fees are illegal.

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Clamshell 9 months, 2 weeks ago

Note to The Tribune: Please stop calling Philip Davis “Brave” ... there is nothing “brave” about this guy, there never has been, and there is nothing “brave” about running on a political platform that encourages people not to pay their bills.

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bogart 9 months, 2 weeks ago

The VAT taxes 7.5% and added increases at 12% have effectively taken out of the pockets of all Bahamians income and increases in fuel costs gas have effectively and efficiently subtracted fron the incomes......and more so the pore ....recent IDB repprt points out the poorest hurt by some 2.4% of their iincome with fuel prices increases...Simply if the govt Is taking MORE and MORE VAT an MORE other Taxes COMING out of your incone and cost of living increasing...an salaries aint increasing...people getting laid off Needin help from other family still gat a job.... Saying mortgagors dont ttalk to the bank an still saying the arrears is high not being paid is a distraction from the fact ...THAT THE CRISES WAS NOT AVERTED....WAY BEFORE IT COLLASP THE BANK....save for more taxpayer yetagain to guarrantee survival.... This obviously did not happen overnight.......BEGS THE QUESTION WHAT WAS YHE CHAIRMAN...BOARD OF DIRECTORS...PAID ..SALARIED BMC...EMPLOYEES ..MANAGEMENT DOING ABOUT THIS....ALL DIS TIME..,!!!!!!.....an telling audited reports dont come in in time....by salaried people...is no excuse....to blame mortgagers for slackness of BOD....who could have nipped this in the bud...or tried....before now crises... The Minister should have also be telling the mortgagers in Grand Bahama for not repaying loans also.....or obviously they too ...would be also in this......

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Schemer18 9 months, 2 weeks ago

They doing crap with the mismanagement of the State money & want to act innocent in these funny looking coat suits telling the struggling poor man learn to pay their bills, when they are worst trying to hide their selfish hideous financial arrears. Vomit.

http://m.tribune242.com/news/2018/oct...">http://m.tribune242.com/news/2018/oct...

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sheeprunner12 9 months, 2 weeks ago

The number of loans being repaid right now to the BMC is 2889, 1366 of which are in arrears.

The value of the loans in arrears is more than $34m.

Mr Turnquest said the BMC is currently owed $194,246,667.

Meanwhile, it owes $395,026,146 to bondholders, including interest.

Then we wonder why we have $8 Billion in public debt????? ........ White elephants like these public corporations

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BahamaPundit 9 months, 2 weeks ago

Re: Sickened Great term: Land Pirates. Instead of the terms "wastage and incompetence" when will we start calling it by its real name: "theft and corruption."

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TheMadHatter 9 months, 2 weeks ago

"The number of loans being repaid right now to the BMC is 2889, 1366 of which are in arrears. The value of the loans in arrears is more than $34m. Mr Turnquest said the BMC is currently owed $194,246,667."

AMAZING how he can spurt out these figures when it has to do with money owed to govt - but when WE keep asking over and over for the exact breakdown of the $8B in debt and a listing of payments made to who how much and dates on our foreign debt, we are told to JUST SHUT UP AND PAY YA VAT BEFORE WE DEVALUE YA CURRENCY. We is the government, large and in charge - you dont deserve to know this info and ya dumb D-average a$$ cant understand it anyway.

Just pay ya mortgage and get ready to ink ya fingah in 2022. Dont ask where the VAT money gone. Dont ask. Dont ask.

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DDK 9 months, 2 weeks ago

It IS time to march on parliament! If we knew the true debt figures we could flash them on billboards all over Nassau and the Family Islands, along-side the VAT totals collected to date. Perhaps THEN they would start bring down the debt!

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DWW 9 months, 2 weeks ago

What about all the new vehicles with red plates? Bought right after election. Every year.

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DDK 9 months, 2 weeks ago

Sickening. They cannot help themselves. Not to mention petrol consumption because they are up and down all over the place.

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TalRussell 9 months, 2 weeks ago

Ma Comrades, don't let it be lost why need be skeptics how KP and Romauld, seem be jumping take credit for foreclosures that were done in legal system - long before 10 May 2017... but we done knows Minnis and KP, never touches anything which don't involve the PLP

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bogart 9 months, 2 weeks ago

IN erry business enterprise where money has to be collected.....and likelihood of some not being collected........THE COMMON SEMSE IS FER THERE TO BE A ....COLLECTIONS DEPARTMENT COLLECTIONS OFFICER..... OR A RECEIVIBLES DEPARTMENT....AN.AN..AN........WID TENS OF MILLIONS OF DOLLARS.......HOW IN THE WORLD DEY DIDNT HIRE SUFFICIENT....STAFF....TO COLLECT THE MONEY....CALL THE PEOPLE STEAD OF WAITING......AN.....WAITING....FOR PEOPLE TO COME IN OR CALLS THEM...COLLASPING THE BANK....save for taxpayers to bail out.....YA HAS A DUTY TO THE SHAREHOLDERS TO GET THE MONEY...GO AFTER THE MONEY YA LENDS OUT.....NOT SIT BACK AN WAIT....FER MANNA TO FALL OUTTA HEAVEN......,!!!.,!.IF YA ya called....male the oft complained of HARASSING, DEMANDING....THREATENING....OBNOXIOUS....phpne calls.....delinquent customers do the usual threatening...harassing....phone calls....customers complains of....and gets back $1,000,000.....out of the $194,246,667. ..it woudda makes sense to hire 4 people pays then $25,000 each just to be calling in people to makes arranhements ......!!!!!....if the Former Chamber fella can gets disbarred for 10 years...???....it is time erryone responsible for mismanaging taxpayers money yet agains...be disbarred...!!!!....

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joeblow 9 months, 2 weeks ago

Repossess and/or put liens on all properties! Where's the problem?

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DDK 9 months, 2 weeks ago

Liens are well and fine if dwellings to be repossessed were not built by government!

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TalRussell 9 months, 2 weeks ago

There's lots reasons ask why is it that the Comrade Imperial red shirts cabinet played by different set rules when it funded a 50 person committee to figure out how best help and pay relocate something like legal and illegal residents 8 Shantytowns....... did I miss the same level compassion offer financial relocation assistance mortgage defaulters .... Didn't KP and Dion not say that there is no way the government goin' just toss Shantytowns residents and their children's and furniture's out onto streets?

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concernedcitizen 9 months, 2 weeks ago

Many of these loans were never going to paid back , they were homes for cronies ,friends ,political generals ,,many of which the cronies and friends put out to rent and never had an intention of paying back the government ,juss another Peoples penny savings bank ,Development bank ,Bank of the Bahamas type scam ,, a way to get our taxpayer money out the treasury .I say if the people can,t or won,t pay the mortgage put them out find buyers that can .If I cant pay my rent/mortgage for whatever reason I got to go live w/ my Ma ,uncle or something ..I,m tired of this sh#t ,,you would be surprised to find out you got these homes ,,put them out for rent and stiffed the tax payer

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bogart 9 months, 2 weeks ago

The institution licenced and Regulated as a Bank......now Throwing on the market a bunch of houses and selling them raises other questions.... 1. Tha bank aint no licenced Real Estate qualified Real Estate progessional trained to sell houses showcase hightlights to get the best price as the Legislated licemcemed regulated Real Estate professional to get the best prices for the customer.....showing ot 24-7...well more than the bank.... 2. Plenty talk outside already that people inside banks allegedly does fishy things like getting friends family lovers cronies to buy homes knowing banks will accept certain amounts....dont lkke to believe gapseed gossip and does not ... 3. Putting large numbers of homes created or may add to existing glut making pfices drop for errybody....supply being more than demand .... 4. Other lenders usually have other buildings as collateral for businesses utilizing number of bank facilities...overdrafts..etc.....other banks unnaturally throwing other buildongs on market lowering property prices causes banks holding buildongs as collateral now have to lessen callin...restrict business lendings 5. W........... When these unnatural things...happen....lots of homes on the market glut......everybody suffers from the cascading effect......lots more affected when the banks all of a sudden throw dozens of houses on the market...!!!!

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BahamaPundit 9 months, 2 weeks ago

Re concernedcitizen This is one of the best posts I've seen on here. You have shown a blazing light of truth onto the scam government we have in the Bahamas, which is little more than a lawless tribal cabal. Good work! 40 years of this criminality by those lawless thugs in government, and I'm surprised this country isn't even worse off.

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proudloudandfnm 9 months, 2 weeks ago

Maybe you should try to do something that GROWS OUR ECONOMY. All you idiots do is talk about how good things coming. Well bulla NOTHING GOOD REACH YET. You and your party have done absolutely nothing to get this country back on its feet. All you've done so far is tax us to death. Grow some balls and DO SOMETHING...

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BahamaPundit 9 months, 2 weeks ago

Proudloudfnm They going to do something as soon as China signs the cheques it promised them. Their entire administration is waiting for China to begin investing.

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truetruebahamian 9 months, 2 weeks ago

Remove the defaulters, take their property and sell it to a buyer who will not require a mortgage. That's not cruel, that's life. Even so, "Some times you have to be cruel to be kind!"

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bogart 9 months, 2 weeks ago

Yes Pundit....Comcermedcitizen is insightful. Again would then go over to the BoB loans in Resolve....taxi plates.......??.....and the really slow pace to have any Financial Ombudsman .....well we did get the separation from the AG ..to throw out nollees....

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BahamaPundit 9 months, 2 weeks ago

As Concernedcitizen said, this BMC matter is almost an exact clone of the BOB matter. Both were lending institutions, both have been pillaged for untold millions of dollars by politically connected people. Both require a forensic audit and criminal charges to be levied. Both are NOT being investigated by the Minnis FNM!

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BahamaPundit 9 months, 2 weeks ago

If either the BMC or BOB matter happened in China, those in charge would be executed. If either happened in the US, those in charge would likely be jailed. In other first world and many third world countries, this would be a huge scandal and audits would be conducted and people would go to jail. In The Bahamas, the FNM calls the PLP a few names and Davis grins.

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BahamaPundit 9 months, 2 weeks ago

The final word in all this is that both PLP and FNM have on at least two occasions aided and abetted and/or directly defrauded the Bahamas Government treasury, which is high treason against the Bahamas Government and its people. If they are willing to do this using banking institutions as their vehicle of fraud, imagine what they are doing with VAT? Bahamas Government = engine of fraud.

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bogart 9 months, 2 weeks ago

......added to the call for investigations should also be the other financial entities controlled by political affiliates....?the Bahamas Development Bank.....the Central Bank..still trying to fogure out how CLICO mamaged to get its money past to invest in Florida leaving Bahamians taxpayers to pay ....!,?

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