In 2002 the wife and I went to look at a lot in Norbrook (St Andrew, Jamaica). She really liked it and we decided to get a loan to acquire it. I had an account with JNBS so decided to get the mortgage through them. At the time it was the best option. The lot valued 2.5M Jamaican dollars and I borrowed $1,750,000 from JNBS at a rate of 14%.
Forgive me for being ignorant to the way banks/building societies work out their interest rates (which I'm sure most individuals are), but it always gets me when I look at my statement and TEN (10) years later I still owe $1,638,407.85, which means I've only paid off $111,592.20 on the loan. I think the people who came up with the whole banking system and mortgages were f'kin geniuses as well as thieves.
Check it: 14% of $1,750,000 is $245,000 correct? Stores have a certain percentage mark up on goods, so when you buy anything anywhere they're making a profit of whatever percent they set for their business. Same thing goes when you see an item on sale - 10%, 12% or 20%. Whatever the tag says that's usually exactly the percentage reflected in the sale. So that's my basic understanding and expectation of how that works. Banks however, obviously do things very different. How many people do you think actually understand what they're paying back? And the interest rates actually go up to 18% I hear, or even more.
My monthly payment since 2002 has been $22,570.52 (JMD) which I've consistently paid until maybe last year when work got slow and everything escalated price wise. However this figure works out to $270,842.64 per year - more than 14% of the initial loan per year. And over the ten years that have passed I've paid $2,708,426.40 (JMD) (actually that's a little off because I now owe a couple months). And remember the property was valued only $2.5M and I borrowed $1.7, so I've actually paid back more than what it valued at the time of purchase. The "Loan Maturity Date" is August 2027, so you can calculate how much money they'll be making the next fifteen years.
No one forced me to take the loan, it was somewhat free will. If you don't have the cash up front you can go to the bank and take the services they offer. The thing is, that 14% was the best option at the time. Think about it, that whole system. I guess that's why bank managers and so forth can live the lavish lives they want and the people who save with them or take loans seem to always be "struggling" to make a payment.
I am blessed though that they haven't auctioned off the lot I'm paying for. Some people aren't that blessed.
Just saying the Jamaican Mortgage "scheme" and interest rates F'kin Sucks!!
Have a great day
Forgive me for being ignorant to the way banks/building societies work out their interest rates (which I'm sure most individuals are), but it always gets me when I look at my statement and TEN (10) years later I still owe $1,638,407.85, which means I've only paid off $111,592.20 on the loan. I think the people who came up with the whole banking system and mortgages were f'kin geniuses as well as thieves.
Check it: 14% of $1,750,000 is $245,000 correct? Stores have a certain percentage mark up on goods, so when you buy anything anywhere they're making a profit of whatever percent they set for their business. Same thing goes when you see an item on sale - 10%, 12% or 20%. Whatever the tag says that's usually exactly the percentage reflected in the sale. So that's my basic understanding and expectation of how that works. Banks however, obviously do things very different. How many people do you think actually understand what they're paying back? And the interest rates actually go up to 18% I hear, or even more.
My monthly payment since 2002 has been $22,570.52 (JMD) which I've consistently paid until maybe last year when work got slow and everything escalated price wise. However this figure works out to $270,842.64 per year - more than 14% of the initial loan per year. And over the ten years that have passed I've paid $2,708,426.40 (JMD) (actually that's a little off because I now owe a couple months). And remember the property was valued only $2.5M and I borrowed $1.7, so I've actually paid back more than what it valued at the time of purchase. The "Loan Maturity Date" is August 2027, so you can calculate how much money they'll be making the next fifteen years.
No one forced me to take the loan, it was somewhat free will. If you don't have the cash up front you can go to the bank and take the services they offer. The thing is, that 14% was the best option at the time. Think about it, that whole system. I guess that's why bank managers and so forth can live the lavish lives they want and the people who save with them or take loans seem to always be "struggling" to make a payment.
I am blessed though that they haven't auctioned off the lot I'm paying for. Some people aren't that blessed.
Just saying the Jamaican Mortgage "scheme" and interest rates F'kin Sucks!!
Have a great day
