Published On: Sun, Oct 1st, 2017

Too good to be true

Hurrican Irma Damages 9

GREAT BAY – In the aftermath of Hurricane Irma at times stories and announcements came out that seem too good to be true. An example is the announcement by the Windward Islands Bank that clients with a loan in good standing will get a grace period of six months and that the interest over that period will be forgiven. This way, the bank said, $750,000 will stay in the pockets of our clients.

But industry insiders, who wish to remain anonymous, say that this offer is not worth what it seems.

They say that the large majority of loans are not mortgages (which are excluded from the offer anyway) but car-loans. These loans are linked to a comprehensive insurance of which the bank is the beneficiary. Insurance payments for damaged and destroyed cars go straight into the account of the bank.

In a best case scenario the bank is then able to forgive the whole loan, because it has already recouped the money from the insurance company. That leaves the subscriber to the loan free of a debt, but also without a car. Subscribers then have the option to buy back the car from the bank at a reduced price and fix the car themselves or take out a new car loan and buy a new car, if  they qualify.

Hurrican Irma Damages 8

Photo captions: Cars that sustained heavy damages during hurricane Irma. Photos by TODAY Newspaper photo journalist, Milton Pieters.