homeowners are set to face a double whammy as several deposit-taking institutions (DTI) are set to increase the interest rate charged on existing mortgages within the next two months while general insurance companies have increased premiums by more than 50 per cent since the start of the year.
The latest bank to send out a release to its customers is Sagicor Bank Jamaica Limited (SBJ) which informed last week that it would be raising rates on July 3 and that the new interest rates and monthly payments would be communicated in short order. SBJ had increased interest rates on variable rate loans by up to 2.50 percentage points on January 26.
“Sagicor Bank Jamaica Limited wishes to advise that we will be increasing our mortgage interest rate by a maximum of 0.6 per cent due to the central bank policy interest rate increases over several months,” the release noted.
The Bank of Jamaica (BOJ) increased its policy rate from 2.50 per cent to 7.00 per cent in 2022 and has maintained that rate since then with its next monetary policy decision to take place on June 29.
JN Bank Limited and customers are set to face an increase on July 1 after the original June 1 timeline was pushed back. The last time JN Bank customers faced an increase on their mortgage rate was last June with increases ranging from 0.25 â€“ 0.75 percentage points with the March 2022 numbers revealing that $82.04 billion or 72.90 per cent of the loan book consisted of mortgages.
“Like many other commercial banks, we have also formally notified our mortgagors with variable rate mortgages that there will be an increase in their mortgage rates. These increases have become necessary because of the general rises in interest rates and costs due to inflation locally and globally,” said JN Bank in an e-mail on Monday.
While JN Bank didn’t reveal the latest range in the query, some JN Bank customer mortgage rates are set to increase to 9.25 per cent on June 30. This puts the range increase between 50 to 100 basis points.
JN Bank has also increased the interest rate charged on its credit card from 34 per cent to 45 per cent in its latest round of revisions on fees charged to customers. JN Bank’s loan book grew from $113.14 billion in March 2022 to $129.52 billion in March 2023 as per the BOJ’s quarterly publication. However, the asset base decreased from $236.46 billion to $231.23 billion over the same period.
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