Mortgages

Finance your home with with a Capita Financial Mortgage:

• Land Loans

  Some questions most frequently asked by prospective customers are:

   

  What is my down payment going to be?

  At CAPITA FINANCIAL the minimum down payment is 10% of the cost of the land being purchased.

   

  What is the maximum repayment period?

  At CAPITA FINANCIAL we provide land loans for up to a maximum of 15 years. The loan must however be repaid by the borrower's 70th birthday.

   

  What are the closing costs like?

  All legal fees associated with the transaction must be bourne by you the borrower. You should therefore consult with your attorney about these costs beforehand.

   

  How will you gauge my ability to pay?

  A very important criterion is your debt service ratio (DSR). To qualify for a loan at CAPITA FINANCIAL your DSR (Total Debt Payments / Gross Family Income) should not exceed 40%. Debt here refers to other mortgage payments, bank loans, hire purchase loans, credit card debt etc.

   

  What security will I have to provide?

  The security for the loan will be a first legal mortgage over the land being purchased.

   

  How do I get started?

  Complete and submit our on-line application form to start the ball rolling. Please note, you must complete all relevant sections of the application form in order for us to fully evaluate your application. Alternatively, you can call us and arrange an appointment with one of our loans officers.

   

  What if I have not identified the piece of land that I wish to buy?

  No problem! View our real estate section to locate that dream lot then contact us as we can finance it for you.

• Residential Mortgages

  Some of the questions most frequently asked by prospective customers are:

   

  Collateral Required

  • First Legal Mortgage stamped to cover the amount of the loan
  • Assignment of Homeowners Insurance – for the value of the house
  • Mortgage Indemnity Insurance (15% of the cost of the property)
    – house and land
  • Assignment of Life/Term/Creditor Life Insurance for the amount of the loan
    – house and land
  • Personal Guarantee from the Directors (applies to Companies only)
  • Mortgage over the fixed and floating assets of the company if funds were used to finance any equipment purchases (applies to Companies only)

   

  What is my down payment going to be?

  At CAPITA FINANCIAL the minimum down payment is 5% of the cost of the property being purchased. The maximum loan amount is EC $675,000.

   

  What is the maximum repayment period?

  At CAPITA FINANCIAL we provide mortgages for up to a maximum of 25 years. The mortgage must however be repaid by your 70th birthday.

   

  What are the closing costs like?

  All legal fees associated with the transaction must be bourne by the borrower. You should therefore consult with your attorney about these costs. In addition to the legal fees, you may also have to pay a negotiation fee. It is therefore important that you demonstrate an ability to cover these costs before you can qualify for the mortgage.

   

  How will you gauge my ability to pay?

  A very important criterion is your debt service ratio (DSR). To qualify for a loan at CAPITA FINANCIAL your DSR (Total Debt Payments/Gross Family Income) should not exceed 45%. Debt here refers to other mortgage payments, bank loans, hire purchase loans, credit card debt etc.

   

  What other conditions will I have to satisfy?

  Apart from the mortgage security, CAPITA FINANCIAL will also request that you provide life insurance coverage equivalent to the amount of the mortgage and fire and perils insurance coverage over the mortgaged property.

   

  How do I get started?

  Complete and submit our on-line mortgage application form to start the ball rolling. Please note, you must complete all relevant sections of the application form in order for us to fully evaluate your application.

  If you are building a new house you will also need to provide us with the house plans showing the relevant planning approvals.

   

  What if I don't actually have a piece of land on which to build the house?

  No problem! View our real estate section to locate that dream lot then contact us as we can finance it for you.

   

  What if I want to buy rather than build?

  Once again, no problem! We at CAPITA FINANCIAL can help you find the house of your dreams through our real estate section. Once you are happy with the choice, we can finance it for you.

   

  Contact us today and one of our professionals will be in touch with you!

• Pre-Approved Mortgages

  Are you thinking about buying your dream home?

  Before you take this step, visit our office and we will discuss the best option suited to your needs. We will also pre-approve the financing that you require.

  There are two great reasons for getting a CAPITA FINANCIAL Pre-Approved Mortgage. The first reason is that you already know how much money you can afford to borrow. The second reason is that because you have these resources available, the vendor (seller) of the property knows that you are serious and you will be able to negotiate a good deal.

   

• Home Equity Loans

  Do you need money for:

  • Home repairs and remodeling?
  • Education of your child?

   

  Then . . . use the equity in your home!

   

  A CAPITA FINANCIAL Home Equity Loan helps you achieve the things you care about! You can borrow up to 90% of the equity in your home and enjoy very competitive interest rates.

  Here are some of the most frequently asked questions that our customers ask.

   

  What do you mean by equity?

  Quite simply, equity means the difference between the appraised value of your home and the balance on the first mortgage.

   

  How will CAPITA FINANCIAL determine the amount that I will be eligible to borrow?

  Let us look at the following example.

   

  Appraised Value of property                   $150,000

  Less Balance due on first mortgage    - $ 60,000

  Equity                                                       $ 90,000

                                                                    X 0.80

  Estimated available equity                      $ 72,000

   

  How do I go about applying for a CAPITA FINANCIAL Home Equity Loan?

  Complete and submit our on-line mortgage application form to start the ball rolling. We also require a valuation from one of our approved valuers.

   

  What are the closing costs like?

  All legal fees associated with the transaction must be borne by you the borrower. You should therefore consult with your attorney about these costs. In addition, you may also have to pay a negotiation fee and a valuation fee.

   

  How will you gauge my ability to pay?

  A very important criterion is your debt service ratio (DSR). To qualify for a loan at CAPITA FINANCIAL your DSR (Total Debt Payments/Gross Family Income) should not exceed 40%. Debt here refers to other mortgage payments, bank loans, hire purchase loans, credit card debt etc.

   

  It is important that you insure your valuables.

• Mortgage Indemnity

  Mortgage Indemnity Insurance

  In an attempt to remain competitive in the face of the increased competition, many of the players in the mortgage finance industry have adopted the strategy of advertising that they would provide up to 95% and 100% mortgage financing to prospective homeowners.

  Such facilities suggest that would-be mortgagors would only now have to come up with a 5% deposit, or in the case of a 100% mortgage, no deposit at all in order to access mortgage financing, rather than having to provide the traditional 20 per cent deposit.

  The reality is, however, that when they approach the mortgage company, they are then advised of their requirement to provide mortgage indemnity insurance to cover the top 15% to 20% of their mortgage loan.

  For many, this requirement becomes an additional cost relative to the mortgage process for which they had not catered. Additionally, they find themselves incurring this cost for something about which they are not very clear.

   

  What is mortgage indemnity?

  Mortgage indemnity is insurance coverage which a mortgage company may require and the cost of which is borne by the mortgagor as a one-time up front payment.

  This insurance coverage is designed to provide protection to the mortgage company in the event that, at some future stage, the mortgagor is unable to maintain his/her mortgage payments and the property has to be repossessed and sold.

  If the property is sold for less than the amount that is outstanding on the mortgage, the company can make a claim against the mortgage indemnity to recover some or all of its losses.

  Mortgage indemnity insurance is effectively an additional form of security for the mortgage company.

   

  How is the premium determined?

  The mortgage indemnity premium is generally determined by the mortgage company's insurance provider.

  The mortgage company would provide its insurer with, among other things, the following details:

  1. The amount of the mortgage loan.
  2. The cost or value of the property, whichever is lower.
  3. The loan to value ratio at which no mortgage indemnity is required.

   

  It is on the basis of this information that the insurance company will determine the premium payable which is calculated as a percentage of the amount of the loan that exceeds of the mortgage company's prescribed loan to value ratio (LTV).

  The LTV is expressed as a percentage of the amount of the mortgage loan over the value of the property.

  The LTV benchmark in the mortgage industry is generally 75% to 80%. It means therefore that mortgage indemnity insurance may be required where the amount of the mortgage loan that exceeds 75% to 80% of the property value.

  The implication for the prospective homeowner therefore, particularly given the current prices for housing, is that the larger the size of the mortgage loan, the higher the mortgage indemnity premium that may be payable.

   

  What happens when a claim is made?

  A mortgage company can make a claim after it exercises itspower of sale (i.e. where the company has actually sold the repossessed property) and the price obtained for the property is less than the balance that is outstanding on the mortgage, that is, there is a shortfall.

  The evidence shows that in most cases, the mortgage indemnity will cover the entire shortfall. If a shortfall occurs however, the mortgagor is still liable for any amount still outstanding, and as such he/she can be sued by the mortgage company to recover this difference.

   

  Does mortgage indemnity benefit the mortgagor?

  There is no doubt that mortgage indemnity insurance is designed to protect the mortgage company against possible losses in the event of default by the borrower.

  However, it is because of mortgage indemnity insurance that prospective homeowners are not only able to pay a lower down payment, but may also be able to acquire homes in areas and on terms that may otherwise be considered too risky. An example of this is 100% mortgages where mortgage companies would be unlikely to provide this type of financing without mortgage indemnity coverage.

  The benefit to the mortgagor is that he/she is able to more readily realize their dream of homeownership, than if they had to save the required deposit before they can approach the mortgage company for financing.

  The critical issue for the prospective homeowners is that in choosing the company from which they would obtain mortgage financing, they must first inquire as to all closing costs, including the costs relative to mortgage indemnity insurance. They may very well find that some companies may choose not to make mortgage indemnity insurance a requirement, thereby making access to mortgage finance much easier and more affordable.

   

• Land Loan and Mortgage Application Requirements

  Land Loan requirements:

  • Job letter
  • Recent Salary Slip (no older than 3 months)
  • If employed outside of St. Lucia, tax return copies of last 2 years
  • Two copies of valid Government issues I.D.s (National I.D., Passport or Drivers’ Licence)
  • Proof of Address (Copy of a utility bill)
  • Invoice/Vendor Letter
  • Recent copy of Land Register/Survey Plan
  • Valuation from a certified member of the Association
  • Inland Tax letter of Property Tax and/or Personal Tax
  • Letter from National Insurance Corporation
  • Banking reference i.e. Bank Statement and/or Reference Letters
  • Copy of Credit Rating
  • Non Nationals of the O.E.C.S and Barbados will additionally require an “Alien Land Holding Licence” prior to loan being disbursed and will require an application being made to Capita to approve the loan.

   

  Mortgage requirements:

  • Job letter
  • Recent Salary Slip (no older than 3 months)
  • If employed outside of St. Lucia, tax return copies of last 2 years
  • Proof of Address (Copy of a utility bill)
  • Two copies of valid Government issues I.D.s (National I.D., Passport or Drivers’ Licence)
  • Valuation from an approved ECCB appraiser (instruction to appraiser to be issued by Capita)
  • Recent copy of Land Register/Survey Plan
  • Compliance Letter from Inland Revenue for Property Tax and/or Personal Tax
  • Compliance Letter from National Insurance Corporation
  • Estimates/Quantities from certified individual (Construction)
  • Approved plan from Development Control Authority (Construction)*
  • Banking reference i.e. Bank Statement and/or Reference Letters
  • Copy of Credit Rating
  • Non Nationals of the O.E.C.S and Barbados will additionally require an “Alien Land Holding Licence” prior to loan being disbursed and will require an application being made to Capita to approve the loan.

   

  If Self-employed

  • Financial Statements (Profit & Loss or Income & Expense statement and Balance Sheet) for the last two years
  • Bank Statements for the last six months
  • Business Registration

   

  If a Company

  • Articles of Incorporation
  • Certificate of Incorporation, Registration, Continuation, Association
  • By-Laws, Constitution
  • Board Resolution
  • Audited Financial Statements (note that companies registered under the Companies Act are required to file returns annually with Corporate Affairs), Income and Expense Statement