CHAPTER
199
HOUSING |
ARRANGEMENT OF
SECTIONS |
PART I
PRELIMINARY |
SECTION |
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PART II
ADMINISTRATION |
Minister to be a corporation sole. |
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Housing Commissions under the Act. |
Constitution of Commissions. |
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PART III
INSURED MORTGAGE LOANS |
Insurance of Loans |
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Conditions of insurable loans. |
Authorised limits of loans. |
Borrower to have policy of life insurance. |
Insured loan for dwelling house erected by an
approved builder for his own occupation. |
Insured loan for newly erected completed
dwelling house or one that is not newly erected but is less than five years
old. |
Insured loan for renovations to dwelling house. |
Insured loans for the enlargement of dwelling
houses already mortgaged under this Act. |
Duty of approved lender to insure mortgaged
premises, etc. |
Implied terms of insured loans. |
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Discharge of minister's liability as an insurer. |
Approval of lenders and builders, etc. |
Duty to consult town planning authority, etc. |
Insurance Settlement |
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PART IV
AUDIT AND REPORT |
Accounts, audit and statistics. |
PART V
MISCELLANEOUS |
Matters to be prescribed by regulations. |
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Offence of giving false information. |
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SCHEDULE. |
CHAPTER 199 |
HOUSING |
An Act to
consolidate and amend the law relating to the housing department; the promotion
of construction of new dwelling houses for persons of moderate means; insurance
of mortgages and purposes connected therewith. | 5 of 1968
13 of 1972
30 of 1975
E.L.A.O., 1974
27 of 1976
8 of 1983
19 of 1998 |
[Commencement 9th
January, 1968] |
PART I
PRELIMINARY |
1. This Act may be cited as the Housing Act. | Short title. |
2. In this Act, unless the context otherwise requires- | Interpretation. |
"approved
builder" means a builder who is approved for the purposes of this Act, in
accordance with the provisions of section 21 of this Act; |
"approved
building plot" means a building plot which is approved by the Minister as
complying with such standards as to situation, availability of services,
amenity and general suitability, as the Minister may prescribe or otherwise
require; |
"approved
lender" means a lender who is approved by the Minister for the purposes of
this Act in accordance with the provisions of section 21 of this Act; and
includes, for the purpose only of enforcing any right, title, power or claim
(whether against the Minister, a borrower, mortgagor, or any other person) of
an approved lender to or in respect of any insured loan, mortgage money or
mortgaged premises, and subject to the provisions of paragraph (c) of section
20 of this Act, any successor in title or assignee of an approved lender; |
"borrower"
means a borrower who is approved by the Minister for the purposes of this Act
in accordance with the provisions of section 10(1)(e) of this Act, and includes
any person to whom the mortgaged premises have been transferred in accordance
with the provisions of section 10(3) of this Act; |
"builder"
means a person whose business includes the building of houses for sale; |
"building
plot" means an area of land on which a dwelling house may lawfully be
erected; |
"Commission"
means a Housing Commission appointed under section 5 of this Act; |
"dwelling
house" includes a building or part thereof which provides living,
sleeping, eating, or food preparation and sanitary facilities for a family; |
"functions"
means duties and powers; |
"insurable
loan" means a loan which complies with the provisions of section 10, 13,
14 or 16 of this Act; |
"insurable
risk" has the meaning ascribed thereto by section 17 of this Act; |
"insurance"
means a contract to insure, and includes a reference to any policy or other
document by which it is evidenced; |
"insurance
fee" means the charge made by the Minister in accordance with the
provisions of this Act for insuring a loan; |
"insured
loan" means a loan in respect of which there is in force an insurance by
the Minister under this Act; |
"lending
value" means the value of any premises as a reasonably adequate security
for a loan which is secured by a mortgage thereon determined by the Minister or
otherwise to the satisfaction of the Minister by such manner of assessment as
the Minister may prescribe or otherwise require; |
"loan"
means a loan or an agreement to make a loan; |
"Minister"
means the Minister responsible for Housing; |
"mortgage"
means a first charge on land for securing money, being a conveyance by way of
mortgage of the estate of the mortgagor in such land; |
"Mortgage
Insurance Fund" means the fund referred to in section 24(1) of this Act; |
"mortgage
money" means money secured by a mortgage; |
"owner"
in relation to any premises means the owner of the entirety of the premises for
a legal estate in fee simple absolute in possession, being an estate which is
not subject to any lease or tenancy, and which is free from trusts and
incumbrances; |
"prescribe"
in relation to the Minister, means to prescribe in accordance with the
provisions of section 26 of this Act, and the word "prescribed" shall
be construed accordingly; |
"repealed
Act" means the Housing Act repealed by section 30 of this Act; |
"service
charges" includes the following charges made by the lender to the borrower
in respect of an insured loan- |
(a) any
application fee paid by the lender under this Act; |
(b) the cost of
survey and of obtaining a certificate of survey; |
(c) attorneys'
fees and disbursements- |
(i) for
searching and settling the title to the premises; |
(ii) for
preparing the mortgage and for necessary copies thereof; |
(iii) for
such other searches of title as may be necessary to ensure the priority of the
mortgage taken as security for the loan; and |
(iv) for
preparing and taking any other security for the loan. |
(2) References in
this Act to any other enactment shall be construed as references to that
enactment as amended by any other enactment including this Act. |
(3) References in
this Act to dollars and cents shall be construed as references to dollars and
cents in Bahamian currency. |
PART II
ADMINISTRATION |
3. (1) The Minister shall, as respects the functions
assigned to him by or under this Act, be a corporation sole, with power to
acquire, hold, lease, and dispose of property, to enter into contracts, to sue
and be sued and to do all things necessary for the purposes of this Act and all
property transferred to the Minister by this Act or any other Act or which
otherwise becomes vested in him shall be held by him in trust for Her Majesty
in right of Her Government of The Bahamas for the purposes of this Act. | Minister to be a corporation sole. |
(2) Upon and by virtue
of the appointment of any person to be the Minister charged with the
responsibility for the administration of this Act, the benefit and burden of
all deeds, contracts, bonds, securities and things in action vested in his
predecessor at the time of his predecessor ceasing to hold office shall be
transferred to and vested in and enure to the person so appointed in the same
manner as if he had been contracted with instead of his predecessor and as if
his name had been inserted in all such deeds, contracts, bonds, or securities
instead of the name of his predecessor. |
(3) The Housing
Corporation which was dissolved on the seventh day of January, 1964, shall be
deemed to be the predecessor of the Minister. |
4. There shall be a Housing Department of the
Government, comprising a Chief Housing Officer and such other officers as may
from time to time be authorised by Parliament, which shall be subject to the
general direction and control of the Minister. | Housing Department. |
5. (1) For the purposes of enabling the Minister to
carry out his general duties in pursuance of the provisions of section 8 of
this Act there shall be appointed in the manner hereinafter provided- | Housing Commissions under the Act. |
(a) a Housing
Commission for New Providence; |
(b) such other
Housing Commissions for the Family Islands as the Minister may by order
prescribe. |
(2) The duty of
the Commissions appointed under subsection (1) shall be to decide, subject to
an appeal to the Minister, whether any loan applied far under this Act shall be
accepted as an insurable loan for the purposes thereof. |
(3) Where no
Commission has been appointed in respect of a Family Island then the duties of
the Housing Commission for that Island shall be carried out by the Housing
Commission appointed for New Providence. |
6. The Schedule to this Act shall have effect with
respect to the Constitution of a Commission and otherwise in relation thereto. | Constitution of Commissions. |
7. (1) Every application made under this Act for a loan
to be deemed an insurable loan shall be referred by the Chief Housing Officer
to the relevant Commission which, after making such enquiries as it deems fit,
shall send its decision in writing to the Chief Housing Officer who shall
communicate the decision to the approved lender and the prospective borrower. | Duties of Commissions. |
(2) For the
purposes of carrying out its functions under this subsection, the Commission
shall have and exercise all the powers of the Minister under section 10, 13,
14, 15 or 16 of this Act save that the Commission shall not be empowered to
prescribe any matter by regulations. |
(3) Any persons
aggrieved by a decision of a Commission under this section may, within one
month of the decision being served upon him, appeal in writing to the Minister
whose decision shall be final. |
8. (1) The Minister may- | Powers of the Minister. |
(a) construct
dwelling houses upon land owned by the Government or to be acquired for such
purposes; |
(b) acquire
dwelling houses, land or housing projects by way of purchase, lease or
otherwise; |
(c) sell,
lease, exchange or otherwise dispose of real or personal property acquired by
him pursuant to this Act; |
(d) carry out
housing development (including the provision of utilities and roads) building,
maintenance, repair and other operations; |
(e) carry on
any business or undertaking in or for the purposes of any housing development; |
(f) grant
loans on such terms and conditions as he deems fit, to person of low and middle
incomes for the purpose of the rehabilitation and improvement of dwelling
houses; |
(g) promote and
encourage the construction of new dwelling houses of sound construction and
affording suitable accommodation for families of low or middle incomes and
senior citizens; |
(h) promote or
encourage the means of financing and construction of dwelling houses for the
benefit of persons wishing to own and occupy such houses to such extent as may
be necessary to meet the public need in various parts of The Bahamas; |
(i) purchase a
mortgage redemption policy of insurance to provide life insurance coverage to
approved borrowers; |
(j) promote
and encourage the establishment of such projects and facilities as would appear
to him to enhance the standard of living, general welfare and well-being of
persons and for those purposes to exercise the powers hereinbefore conferred
upon him. |
(2) In pursuance
of his functions under subsection (1), the Minister may undertake such
investigations and surveys, analysis and research as may appear to the Minister
to be necessary or appropriate, including (without prejudice to the generality
of the foregoing) the collection of data and information on any of the
following matters- |
(a) the housing
census of The Bahamas, and factors affecting the total supply of housing; |
(b) the current
and prospective supply of and demand for housing suitable for families of low
and middle income; |
(c) the
availability of land suitable for building; |
(d) the design
and construction of dwelling houses; with particular references to method,
materials, comfort and cost; or |
(e) the
business of lending money on mortgage, and market problems associated
therewith. |
PART III
INSURED MORTGAGE LOANS |
Insurance of
Loans |
9. (1) The Minister is authorised, upon application by
an approved lender- | Insurance of loans. |
(a) to insure
any loan which is eligible for insurance under this Act (in this Act referred
to as "an insurable loan"); and |
(b) to enter
into a commitment to insure an insurable loan before it has been made or
advanced. |
(2) The Minister
shall, upon application by the lender, issue an insurance policy to the lender
in respect of a loan which is insured under this Act (in this Act referred to
as an "insured loan") and every such policy of insurance shall bear a
serial number which shall be indexed by the Housing Department. |
(3) The Minister
shall at all times in the exercise of his functions under this Part of this Act
use his best endeavours to ensure that he does not, by insuring any loan- |
(a) unduly
increase the loss or risk of loss to the Government consequent upon the default
of borrowers under insured loans; |
(b) assist the
borrower to construct a dwelling house which, when completed, will not be
required by him for occupation by himself or by himself and his family; or |
(c) assist the
borrower to construct or pay for the construction of one dwelling house while
he is still being assisted by means of another insured loan to construct or pay
for the construction of another dwelling house. |
(4) A loan made in
foreign currency shall be eligible for insurance under this Act if it is made
with prior approval of the Controller of Exchange appointed under the
provisions of the Exchange Control Regulations Act, and is made in compliance
with the provisions of sections 10, 13, 14 or 16 of this Act. |
10. (1) Subject to the provisions of subsection (4) of
this section, a loan is eligible for insurance under this Act if all the
following conditions are satisfied, that is to say- | Conditions of insurable loans. |
(a) the loan is
made by an approved lender; |
(b) the loan is
made in respect of the erection on an approved building plot by an approved
builder of a dwelling house of which the plans and specifications have been
approved by the Minister; |
(c) the
Minister is satisfied that the lending value of the said dwelling house on the
day of its completion (together with the said plot) will exceed the amount of
the loan by a sum calculated in accordance with section 11 of this Act; |
(d) the loan is
made before any building work, other than excavation, has been commenced in
respect of the said dwelling house or where the building work has been
commenced, it is certified that the building and the plans after being properly
inspected conform to the requirements of the Buildings Regulation Act and the Town Planning Act and the requirements of the Minister; |
(e) the loan is
made to a person (in this Act referred to as "the borrower") who
provides evidence satisfactory to the Minister that he- |
(i) is not less than eighteen years of age; |
(ii) is
the owner of the building plot on which the dwelling house is to be erected or
on which the dwelling house has been commenced or completed or has entered into
an enforceable agreement to purchase such building plot; |
(iii) is
not under any liability to an approved lender under any loan previously made by
an approved lender and insured by the Minister under this Act; |
(iv) intends
to occupy the said dwelling house as a residence for himself or for himself and
his family; |
(v) is,
having regard to any matters including his means of livelihood which may appear
to the Minister to be material, likely to discharge his obligations under the
loan; |
and
is otherwise acceptable to the Minister as a borrower; |
(f) the
approved builder has entered into a building contract with the borrower in such
terms as the Minister may prescribe or otherwise require or approve, for the
erection in a proper and workmanlike manner and in accordance with the plans
and specifications approved as aforesaid, of a dwelling house on the building
plot; |
(g) the loan is
made subject to such terms as the Minister may prescribe or otherwise require,
including terms as to the advancement of the loan, whether by instalments or
otherwise, for securing that the obligations under the building contract of the
approved builder to the borrower and of the borrower to the approved builder
are discharged, and for securing that any failure on the part of the approved
builder to erect the dwelling house in a proper and workmanlike manner, or in
accordance with the approved plans and specifications, is remedied; |
(h) the loan
bears interest at a rate not exceeding the prescribed rate; |
(i) the loan
is secured by a mortgage in favour of the approved lender on the approved
building plot (including the said dwelling house when erected thereon), which
is in such form as may be prescribed or otherwise required or approved by the
Minister and which is secured by such further security, assignments, assurances
and agreements as the Minister may prescribe or otherwise require or approve; |
(j) the loan
is made on terms that all the mortgage money shall be repaid within a period of
thirty years following the date on which tie first advance is made under the
loan, and on such other terms as to the payment of principal (including the insurance fee, service charges, charges
for installation or connection of utilities, building permit fees and other
charges) and interest by equal monthly instalments or otherwise as the Minister
may prescribe or otherwise require or approve; |
(k) the loan is
made on such terms not inconsistent with the provisions of this Act with
respect to insurance, repairs, alterations, payment of taxes on property,
payment of service charges and other charges; remedies of the lender in the
event of the borrower's default under the loan, terms limiting or affecting the
rights of the borrower to assign or convey his estate or interest in any
premises or other property on which the loan is secured, as the Minister may
prescribe or otherwise require or approve; and |
(l) the loan
is made on such other terms, not inconsistent with the provisions of this Act,
as the Minister may prescribe or otherwise require, for the purpose of ensuring
that the Minister does not insure loans which are not in his opinion acceptable
risks, having regard on the one hand to the amount of the insurance fee, and on
the other hand to the need for providing housing for families of low and middle
incomes. |
(2) The following
provisions shall have effect for the purpose of facilitating the arranging of
insured loans- |
(a) the
Minister may, on such terms as he may direct, approve, consent to or accept
evidence of any matter or thing for any purpose connected with the fulfilment
by any loan of the conditions provided in subsection (1) of this section before
that loan is made or before any application is made for the insurance of that
loan by the Minister; |
(b) no
mortgage, conveyance, contract, agreement or bond shall fail to satisfy any of
the conditions provided in subsection (1) of this section for the reason only
that it is made conditional upon the insurance of any loan by the Minister. |
(3) With the
approval of the Minister and the approved lender the borrower may transfer the
mortgaged premises to a person who would have been eligible as a borrower under
the provisions of this Act to receive a loan under this Act. |
(4)
No loan shall be eligible for insurance under this Act if the lending value of
the premises in respect of which the loan is sought exceeds
one hundred thousand dollars: |
Provided
that the lending value of the premises shall not include the value of the
building plot on which the dwelling house is constructed where its inclusion
would cause the said lending value to exceed one hundred
thousand dollars. |
11. (1) A loan shall
not be eligible for insurance under this Act if the amount of the loan exceeds
the sum of the following percentages of the lending value of the dwelling house
on the date of its completion, that is to say- | Authorised limits of loans. |
(a) ninety-nine
per centum of the first fifty thousand dollars or part thereof; and |
(b) ninety per
centum of the second fifty thousand dollars or part thereof. |
(2)
For the purposes of subsection (1) of this section- |
(a) where a
loan is made in a foreign currency, the percentages specified in subsection (1)
of this section shall be calculated upon the equivalent in Bahamian currency of
the lending value or proportion thereof expressed in that foreign currency; and |
(b) the lending
value of the dwelling house shall include the value of the approved building
plot on which the dwelling house is constructed and also the insurance fee,
service charges, charges for installation or connection of utilities, building
permit fees and other charges payable in respect of the loan: |
Provided that
where, in accordance with the proviso to section 10(4) of this Act, the value
of the approved building plot is excluded, then, the lending value of the
dwelling house shall not include the value of the approved building plot. |
12. A loan shall not be eligible for insurance under
this Act unless the borrower or the person to whom any mortgaged premises are
transferred in accordance with section 10 either- | Borrower to have policy of life insurance. |
(a) has a valid
policy of insurance on his life with an insurance company approved by the
Minister for such an amount as is sufficient to cover the full amount of the
loan; or |
(b) if he has
no such policy, takes out either an insurance policy on his life or a mortgage
redemption policy with an insurance company approved by the Minister and, |
undertakes
to maintain the policy of insurance by regular payment of premiums, assigns the
benefits of such policy to the lender and deposits the policy with the lender. |
13. (1) Notwithstanding the provisions of paragraphs
(f) and (g) of section 10(1) of this Act and subject to the provisions of
subsection (2) of this section the Minister may on the application of an
approved lender insure a loan made to an approved builder to enable him to
erect a dwelling house which he intends to occupy as a residence for himself or
for himself and his family. | Insured loan for dwelling house erected by an approved
builder for his own occupation. |
(2) In the case of
an application by an approved lender under the provisions of subsection (1) of
this section the conditions set out in section 10(1) of this Act shall apply
save that in lieu of the conditions prescribed by paragraphs (f) and (g)
thereof the Minister shall be satisfied that under the agreement for the loan
the approved builder is bound to erect the dwelling house in a proper and
workmanlike manner and in accordance with the plans and specifications approved
by the Minister and that the approved builder will forthwith remedy any failure
to comply with such conditions. |
14. In addition to the other powers vested in the
Minister under this Act, the Minister shall have power to insure loans for the
purchase of dwelling houses in respect of which all the following conditions
are fulfilled, that is to say- | Insured loan for newly erected completed dwelling
house or one that is not newly erected but is less than five years old. |
(a) the loan is
made in respect of a completed dwelling house which either- |
(i) is
newly erected on an approved building plot in accordance with plans and
specifications approved by the Minister by an approved builder who is bound by
any enforceable contract to remedy forthwith any failure on his part to erect
the said dwelling house in a proper and workmanlike manner; or |
(ii) not being newly erected has been constructed to such
design and specifications as the Minister may approve and is certified by an
inspector appointed by the Minister to have been constructed in a good and
workmanlike manner and to be in a good state of repair. |
(b) all the
conditions prescribed in paragraphs (a), (c), (d), (e) and (h) to (l) inclusive
of section 10(1) of this Act are mutatis mutandis satisfied. |
15. The Minister may insure loans for alteration,
enlargement, repair or improvement of dwelling houses under this Act where the
dwelling house is not subject to any mortgage or charge if all the following
conditions are satisfied- | Insured loan for renovations to dwelling house. |
(a) the loan is
made in respect of a completed dwelling house which is certified by an
inspector appointed by the Minister to have been constructed in a good and
workmanlike manner and is capable of being put in a state of good repair; |
(b) the plans
and specifications for the alteration, enlargement, repair or improvement are
approved by the Minister; |
(c) the loan is
made on terms that all the mortgage money shall be repaid within fifteen years
following the date on which the first advance is made under the loan or the
estimated life of the building, whichever is less and on such terms as to the
payment of the principal (including the insurance fee, service charges, loan
commitment fee, charges for installation or connection of utilities, building
permit fees, and other charges) and interest by equal instalments, or otherwise
as the Minister may prescribe or otherwise require or approve; |
(d) the
Minister is satisfied that the amount of the loan does not exceed forty-two thousand dollars; |
(e) an approved
builder has entered into a building contract with the borrower for the
structural alterations, additions, repairs or improvements to the dwelling
house on such terms as the Minister may prescribe or otherwise require and in a
proper and workmanlike manner in accordance with the plans and specifications
approved by the Minister; |
(f) the loan
bears interest at a rate not exceeding the prescribed rate; |
(g) the loan is
made subject to such terms as the Minister may prescribe or otherwise require,
including terms as to the advancement of the loan whether by instalments or
otherwise for securing that the obligations under the building contract of the
approved builder to the borrower and of the borrower to the approved builder
are discharged and for securing that any failure on the part of the approved
builder to erect the structural alterations, additions, repairs or improvements
in a proper and workmanlike manner or in accordance with the approved plans and
specifications is forthwith remedied; |
(h) the loan is
secured by a mortgage in favour of the approved lender on the dwelling house
and lot (including the structural alterations, additions, repairs or
improvements when erected) which is in such form as may be prescribed or
otherwise required or approved by the Minister and which is secured by such
further security, assignments, assurances and agreements as the Minister may
prescribe or otherwise require or approve; |
(i) the
conditions prescribed in paragraphs (k) and (l) of section 10(1) of this Act
are satisfied. |
16. (1) Where an approved borrower has an insured loan
(hereinafter referred to as the "original loan") that has not been
fully repaid and for the purpose of making structural additions to the
mortgaged premises such borrower has made an agreement with the approved lender
for a further loan (hereinafter referred to as the "further loan") to
be secured upon such dwelling house, the Minister may insure such further loan
in accordance with the other provisions of this Act if all the following
conditions are satisfied, that is to say- | Insured loans for the enlargement of dwelling houses
already mortgaged under this Act. |
(a) the need
for the increased accommodation arises from an increase in the number or age of
the members of the borrower's family or his dependants; |
(b) the
approved borrower has not defaulted in respect of the original loan and
continues in every respect to be acceptable to the Minister as a borrower; |
(c) the
dwelling house is not subject to any mortgage or charge other than that arising
from the original loan; |
(d) the plans
and specifications for the structural additions are approved by the Minister; |
(e) the
Minister is satisfied that the amount outstanding on the original loan together
with the amount of the further loan will not exceed the sum of the following
percentages of the lending value of the dwelling house when the structural
additions are complete that is to say- |
(i) ninety-nine
per centum of the first fifty thousand dollars or part thereof; and |
(ii) ninety
per centum of the second fifty thousand dollars or part thereof, |
or if the
loan is made in a foreign currency, the equivalent amounts in that currency and
in any case that the said lending value will not exceed one hundred thousand
dollars or its equivalent in a foreign currency. |
(f) an
approved builder has entered into a building contract with the borrower for the
erection of the structural additions to the dwelling house on such terms as the
Minister may prescribe or otherwise require including provisions for the
erection of such additions in a proper and workmanlike manner in accordance
with the plans and specifications approved by the Minister; |
(g) the loan is
made subject to such terms as the Minister may prescribe or otherwise require
including terms as to the advancement of the further loan whether by
instalments or otherwise for securing that the obligations under the building
contract of the approved builder to the borrower and of the borrower to the
approved builder are discharged and for securing that any failure on the part
of the approved builder to erect the structural additions in a proper and
workmanlike manner or in accordance with the approved plans and specifications
is forthwith remedied; |
(h) the further
loan bears interest at a rate not exceeding the prescribed rate; |
(i) the
further loan is secured by a supplementary deed of mortgage or further charge
or by an endorsement on the original mortgage in favour of the approved lender
on the mortgaged premises (including the structural additions when erected) so
that the whole amount (including the further loan) outstanding at the date of
the further loan is subject in all respects to such terms and conditions as the
Minister may prescribe or otherwise require or approve and which conform with
the provisions of paragraphs (i) to (l) inclusive of section 10(1) of this Act: |
Provided
that if the approved borrower and approved lender so agree, the Minister may
permit the period of repayment of the whole loan to be extended for such
reasonable period as he may think fit not exceeding the period specified in
section 10(1)(j) of this Act. |
(2) The insurance
fee in respect of a further loan insured under the powers conferred by this
section shall be the sum equal to two per centum of the amount of the further
loan and the provisions of section 19 of this Act shall apply mutatis
mutandis. |
(3) Where the
Minister exercises his powers of insurance under this section, the further loan
and such part of the original loan as remains outstanding at the date of the
further loan shall together be deemed to be an insured loan within the meaning
of this Act save in so far as the context of any provision thereof otherwise
requires. |
(4) For the purposes of paragraph (e) of
subsection (1) of this section, the lending value of the dwelling house shall
include the insurance fee, service charges, charges for installation or
connection of utilities, building permit fees and other charges payable in
respect of the further loan. |
17. (1) Subject to the provisions of this section,
every premises which is a security for an insured loan shall be insured and
kept insured by the lender against all insurable risks (as defined in the next
succeeding subsection) for the full amount of the value of the property at the
date of the making of the insured loan, or for such greater or lesser amount as
the Minister may, from time to time, having regard to any fluctuations in the
cost of building, require by notice in writing to the lender. | Duty of approved lender to insure mortgaged premises,
etc. |
(2) The expression
"insurable risk" means loss or damage by such occurrences or
combination of occurrences as the Minister may prescribe to be insurable risks
for the purposes of this Act: |
Provided that a
lender shall not be under any duty to insure or keep insured any premises
against any occurrence which is not an insurable risk on the date on which the
loan secured by such premises is insured by the Minister. |
(3) All moneys
received by the lender under an insurance effected in accordance with the provisions
of this section shall be applied by the lender acting on the borrower's behalf
in employing an approved builder to make good the loss or damage in respect of
which such moneys are received: |
Provided that if- |
(a) it is not
reasonably practicable to make good such loss or damage within a period of
twelve months following the occurrence of such loss or damage; or |
(b) the
Minister is satisfied, on timely application made in that behalf by the lender
or by the borrower, that it is either not reasonably practicable or not
desirable that such loss or damage should be made good out of such moneys, |
and the
Minister so directs, all such moneys shall be applied in or towards the
discharge of the borrower's liabilities to the lender, and any balance
remaining thereafter shall be paid to the borrower. |
(4) All premiums
paid by the lender in accordance with the provisions of this section shall be a
charge on the premises insured in like manner as the principal sum of the loan,
and with the same priority and with interest at the same rate, and references
in this Act to the principal sum and to interest thereon shall include
references to such premiums and to such interest thereon respectively. |
(5) The provisions
of section 21(1)(b) and of section 25 of the Conveyancing and Law of
Property Act, and of any enactment amending or extending any of those
provisions, shall not apply to any mortgage for securing any loan which is
insured by the Minister under this Act; and the provisions of this section of
this Act shall have effect notwithstanding any enactment, rule of law or
contract to the contrary; and an approved lender shall have all the powers
necessary for compliance with the provisions of this section. |
18. Without prejudice to any other rights or remedies
of the Minister as an insurer, there shall be implied in every insurance of a
loan by the Minister under this Act, notwithstanding the express terms of such
insurance, each of the following terms, namely- | Implied terms of insured loans. |
(a) that if the
lender is negligent in the administration of the loan or in the protection of
the security for the loan, whether before or after the realisation of that
security, then- |
(i) the
liability of the Minister to the lender under the insurance shall be reduced to
such extent, if any, as it is the result of such negligence; and |
(ii) any
dispute as to the fact or extent of such negligence, or as to whether or to
what extent the liability of the Minister should be reduced in consequence of
such negligence, shall be referred for arbitration to a sole arbitrator
acceptable to the Minister and to the lender, or if no sole arbitrator is
acceptable to both parties, then to three arbitrators, one of whom shall be
chosen by each party and the third of whom shall be chosen by the other two,
and the cost of such arbitration shall be borne as agreed by the parties, or in
default of agreement, as determined in the arbitration award; |
(b) that the
Minister shall be entitled to deduct from any sum payable under the insurance a
sum equal to the sum by which the cost of repairing or replacing any damage or
loss by any insurable risk (as defined in section 17 of this Act) to the
premises by which the loan is secured exceeds the aggregate of all sums paid to
the lender under insurance policies covering such insurable risks in force
respecting the premises; unless the damage or loss has been repaired or
replaced to the satisfaction of the Minister. |
19. (1) The insurance fee in respect of an insured
loan shall be paid by the lender to the Minister before the loan is insured,
and may be recovered by the lender from the borrower in accordance with the
terms of the insured loan. | Insurance fee. |
(2) The insurance
fee in respect of an insured loan shall be a sum equal to two per centum of the
principal sum of the loan (being, in the case of a loan advanced by
instalments, the aggregate of the sums of all the instalments making up the
loan, including service charges, charges for
installation or connection of utilities, building permit fees and other
charges), or such other percentage of the principal sum of the loan as the
Minister may prescribe. |
(3) The insurance
fee shall be calculated on the amount of the principal sum of a loan before
there is included in that sum any sum in respect of the advance of the
insurance fee by the lender to the borrower. |
20. Without prejudice to any other rights or remedies
of the Minister as an insurer, the Minister shall be discharged from all
liability in respect of the insurance of a loan under this Act, notwithstanding
any of the terms of that insurance, in any of the following events, that is to
say- | Discharge of Minister's liability as an insurer. |
(a) if the
lender fails to disclose any fact known to the lender which may reasonably have
affected the decision of the Minister to insure that loan; |
(b) if the
lender fails to disclose to the Minister any defect in the title of the
borrower to premises which are mortgaged by way of security for the loan, being
a defect which the lender has discovered or ought with reasonable diligence to
have discovered, and if the defect is one which might reasonably have affected
the decision of the Minister to insure that loan; |
(c) if the
lender assigns or conveys, otherwise than with the approval of the Minister or
to another approved lender, any of the rights of the lender under the loan or
under any mortgage or other charge or lien by which the loan is secured; |
(d) if the
lender varies or waives any of the obligations of the borrower under the loan
without the approval of the Minister; |
(e) if the
lender, otherwise than in accordance with the terms of the loan, releases any
security or personal covenant taken as a security for the loan, without the
approval of the Minister; or |
(f) if the
lender has failed to comply with the provisions of section 17 of this Act. |
21. (1) The Minister may approve any lender or builder
for the purposes of this Act. | Approval of lenders and builders, etc. |
(2) An applicant
shall not be approved as a lender or builder unless the Minister is satisfied- |
(a) that the
applicant possesses all such qualifications, including a sufficiency of funds
and experience, as may be considered necessary; and |
(b) that the
applicant satisfies all such conditions of approval for lenders or builders, as
the case may be, as the Minister may prescribe. |
(3) The Minister
may at any time terminate the approval given to a lender or builder under this
section by not less than six months' notice in writing: |
Provided that no
such notice of termination shall affect the rights or obligations of any person
under any contract, or under any commitment to which section 9 of this Act
refers, being a contract or commitment which is made or entered into before the
date on which such termination takes effect. |
(4) Every approved
lender shall, within thirty days after the end of each calendar month, send to
the Minister a report in such form as may be prescribed or otherwise required
by the Minister, listing all insured loans administered by him and which are in
arrears as at the end of that month to the extent, in respect of periodical
payments due monthly, of an amount equal to, or in excess of, three monthly
payments, and in respect of periodical payments due quarterly, semi-annually or
annually, in any amount, and advising the Minister of the steps taken to
recover such arrears. |
(5) The Minister
shall be entitled, by his authorised representatives, to inspect the books,
records and accounts of an approved lender with respect to any insured loan,
during the business hours of the lender, and where any such books, records or
accounts are kept outside The Bahamas, to require the lender to furnish to the
Minister for inspection the originals or copies thereof or particulars
therefrom, as the Minister may from time to time require. |
(6) The Minister
shall be entitled, by his authorised representatives, to inspect the books,
records and accounts of an approved builder with respect to any contract
entered into by the builder to erect or to make good any damage to an approved
dwelling house on premises charged as a security for an insured loan, during
the business hours of the builder, and where any such books, records or
accounts are kept outside The Bahamas, to require the builder to furnish to the
Minister for inspection the originals or copies thereof or particulars
therefrom, as the Minister may from time to time require. |
(7) Every approved
builder shall, upon first being approved under the provisions of this section,
pay to the Minister such fee as may be prescribed. |
22. In carrying out his functions under this Act with
respect to the approval of dwelling houses and building plots, the Minister
shall consult with every department of the Government of The Bahamas or public
authority which has statutory functions relating to the planning and control of
building or of the development of land. | Duty to consult town planning authority, etc. |
Insurance
Settlement |
23. (1) Subject to the provisions of this section, an
approved lender, who is the creditor under an insured loan which is secured by
a mortgage on premises, may, where default has occurred under the mortgage,
realise his security by selling those premises in accordance with the
provisions of this section. | Insurance settlement. |
(2) A sale of
premises in accordance with the provisions of this subsection shall, whether or
not in exercise of the powers of sale conferred on a mortgagee by any
enactment, be effected by public auction in the first instance, or failing such
a sale then by private treaty. In either of the foregoing events such sale
shall only take place at a price which shall not be less than a sum equal to
the aggregate of the following sums (hereinafter referred to as the "settlement
value")- |
(a) the balance
of the principal sum of the loan owing on the date when the security is
realised; |
(b) the
interest owing on the said date under the loan in respect of the period of nine
months immediately preceding the said date; |
(c) such reasonable
costs of realising the security and of selling the premises as are incurred by
the lender as the Minister may approve or as the Minister may have agreed as a
term of the insurance of the loan. |
(3) If a sale
shall not take place in accordance with subsection (2), the approved lender
shall forthwith notify the Minister and the Minister shall either- |
(a) authorise
the lender to sell the property at the best price reasonably obtainable
(whether by public auction or otherwise) and if upon sale such price is less
than the settlement value of the property the Minister shall pay to the lender
a sum equal to the settlement value after deducting therefrom the price at
which the premises were sold; or |
(b) require the
lender to transfer to him or his nominee all rights to and in respect of the
insured loan and all collateral or other securities therefor on payment of the
settlement value of the property by the Minister to the lender calculated in
accordance with paragraphs (a), (b) and (c) of subsection (2) of this section;
or |
(c) require the
lender to sell the property to the Minister or his nominee at the settlement
value and to convey title to the Minister or his nominee free and discharged
from all liability to the lender or the borrower: |
Provided that if
the Minister shall authorise the sale of the property under paragraph (a) and
such sale shall not take place in accordance with that paragraph, the Minister
shall give further directions in accordance with either paragraph (b) or (c). |
(4) The payment by
the Minister to an approved lender in respect of an insured loan of the sum
provided for in subsection (3)(a) shall discharge the Minister from all
liability to the lender in respect of the insurance of the loan. |
(5) In every sale
of mortgaged premises in accordance with the provisions of subsection (2) of
this section- |
(a) such
premises shall be sold for the same estate as the mortgagor would have therein
but for the mortgage, and subject only to such conditions respecting title or
evidence of title, or other matters, as it is necessary or proper to impose on
the sale of that estate or as the Minister may permit to be imposed; and |
(b) in the case
of sale by public auction, notice of intention to sell the mortgaged premises
by public auction of the time, date and place of such auction, shall be
published in three issues of the Gazette before the date of such
auction: |
Provided that a
period of one month shall elapse between the date of the publication of the
first notice and the date of the publication of the third notice. |
(6) Where, in
addition to being secured by a mortgage on one premises, an insured loan is
also secured by a mortgage or charge or lien on other premises or other
property, subsection (1) of this section, shall have effect as if references to
a security included references to all securities for the loan, and as if
references to premises included references to all premises and property on
which the loan is secured. |
(7) In the case of
a loan made in a foreign currency, it shall be lawful for the Minister to make
payments to the approved lender under the provisions of subsection (3) of this
section in such foreign currency notwithstanding any loss accruing to the
Minister as a result of an appreciation in the value of such foreign currency
in terms of the currency of The Bahamas occurring since the date when the loan
was insured under the provisions of this Act. |
24. (1) The Minister shall continue to maintain the
fund known as the Mortgage Insurance Fund (in this section referred to as
"the Fund") established under the provisions of the repealed Act, out
of which all payments required to be made by the Minister under section 23 of
this Act shall be made, and into which all insurance fees received by the
Minister under this Act shall be paid. | Mortgage Insurance Fund. |
(2) The fulfilment
of all the obligations of the Minister under section 23 of this Act shall be
guaranteed out of the Consolidated Fund of The Bahamas and accordingly there
shall be paid into the Fund from time to time out of the Consolidated Fund by
warrant under the hand of the Minister of Finance such sums as may be necessary
to increase the Fund to an amount which will enable the Minister to discharge
those obligations. |
(3) Whenever any
sum is paid out of the Consolidated Fund under subsection (2) of this section,
the Minister shall prepare a statement to be laid before the House of Assembly. |
(4) Without
prejudice to the provisions of subsection (2) of this section, where the Fund
at the end of any financial year exceeds ten per cent of the total amount of
loan insurance in force, the Minister shall apply the surplus towards- |
(a) firstly
repaying to the Consolidated Fund all sums paid therefrom into the Fund in
accordance with subsection (2) of this section; and |
(b) secondly
repaying to the Treasury the equivalent of the sum of fifty thousand pounds
advanced to the Fund in accordance with section 19 of the repealed Act. |
(5) Subject to the
provisions of subsection (4) of this section the Minister may from time to time
invest in securities approved by the Governor-General such part of the liquid
assets of the Fund as the Governor-General may approve. |
(6) No payments
shall be made out of the Fund except such payments as are authorised to be made
by this Act. |
(7) The Minister
shall maintain and operate a bank account in the name of the "Housing
Department Mortgage Insurance Fund Account" with a bank approved by the
Governor-General into which there shall be deposited all moneys authorised by
this section to be paid into the Fund and from which there shall be withdrawn
all moneys authorised by this section to be paid out of the Fund. |
PART IV
AUDIT AND REPORT |
25. (1) The Minister shall keep proper accounts and
other records and shall prepare in respect of each financial year a statement
of the accounts of the Minister in a form which shall comply with the best
commercial standards. | Accounts, audit and statistics. |
(2) The accounts
of the Minister shall be audited by auditors to be appointed in respect of each
financial year by the Governor-General, and the auditors shall make a report on
the accounts examined by them and on the statement of accounts prepared under
subsection (1) of this section: |
Provided that no
person shall be qualified to be so appointed unless he is a member of one of
the professional bodies of accountants established in the United Kingdom,
Canada or the United States of America. |
(3)
As soon as the accounts of the Minister have been audited, the Minister shall
lay before each House of Parliament a copy of the statement referred to in
subsection (1) of this section and a copy of the report made by the auditors on
that statement, and copies thereof shall be made available by the Minister to
the public at a reasonable price. |
(4)
The Minister shall compile and publish such statistics relating to his
principal activities under this Act and to the provision of and demand for
dwelling houses for ownership and occupation by families of low and middle
incomes, as the Minister may consider necessary for the purposes of this Act. |
PART V
MISCELLANEOUS |
26. (1) Any power conferred by this Act on the Minister
to prescribe any matter or thing shall be exercised by the making of
regulations. | Matters to be prescribed by regulations. |
(2) Without
prejudice to any powers of the Minister under any of the provisions of this
Act, the Minister may prescribe any of the following matters or things- |
(a) the forms
to be used, the procedures to be followed, the information and documents to be
submitted, and the application fees to be paid, in and in connection with the
making and securing of an insurable loan, the insuring of the loan, the making
of advances to the borrower, the realisation of the security in the event of
the borrower's default and the settlement of claims under the insurance policy; |
(b) the
standards to be conformed to by approved building plots and by dwelling houses
to be erected thereon with the assistance of insured loans; and plans,
specifications and other documents and information to be furnished to the
Minister in relation thereto; |
(c) the service
charges and other charges (other than interest on the principal sum), and the
maximum amount thereof, which may be charged by the lender to the borrower
under an insured loan; |
(d) the
inspections to be made of an approved building plot which is security for an
insured loan and the stages in the course of construction of a dwelling house thereon
at which such inspections shall be made; provision for securing the remedying
of departures from the prescribed standards or agreed plans or specifications,
and for requiring the withholding by the lenders of advances of loans from
builders who fail to remedy such departures; and the forms to be used and the
procedures to be followed; |
(e) the
circumstances in which and the extent to which the terms of an insured loan may
be varied or waived; |
(f) the
maximum rate of interest which may be charged by the lender to the borrower
upon an insured loan; |
(g) the
occurrences or any combination of occurrences which are to be deemed insurable
risks for the purposes of this Act. |
(3) The Minister
shall not be prevented by any regulations made under this Act from making any
requirements which he is empowered by this Act to make and which is not
inconsistent with those regulations. |
27. (1) The Treasurer is hereby authorised to pay to
the Minister such sums as the Minister may require on account of administrative
expenses during any financial year. | Administrative expenses. |
(2)
The Minister shall maintain and operate a bank account in the name of the
"Housing Department Administrative Expenses Account" with a bank into
which the advances made under the authority of subsection (1) of this section
shall be paid and from which all administrative expenses properly authorised by
the Minister shall be met. |
28. Any notice or other document required or
authorised to be given, delivered or served under this Act or regulations made
thereunder may be given, delivered or served either- | Service of notices, etc. |
(a) by
delivering it to the person to whom it is to be given or delivered or on whom
it is to be served; or |
(b) by leaving
it at the usual or last known address of that person; or |
(c) by sending
it by registered letter, addressed to that person at his usual or last known
address; or |
(d) in the case
of an incorporated company or body, by delivering it to the secretary of the
company or body at the registered or principal office of the company or body,
or sending it by registered letter addressed to the secretary of the company or
body at that office; or |
(e) if it is
not practicable after reasonable enquiry to ascertain the name and address of a
person to whom it should be given or delivered, or on whom it should be served,
as being a person having any interest in the premises, by addressing it to him
by the description of the person having that interest in the premises (naming
them) to which it relates, and delivering it to some responsible person on the
premises, or affixing it, or a copy of it, to some conspicuous part of the
premises. |
29. (1) If any person, in giving any information,
making any application or claim or giving any notice for the purposes of any
provision of this Act or of any regulation thereunder, makes any statement
which he knows to be false in a material particular, or recklessly makes any
statement which is false in a material particular, that person shall be liable
on summary conviction to imprisonment for a term of three months or to a fine
of three hundred dollars or to both such imprisonment and such fine. | Offence of giving false information. |
(2) Where an
offence under subsection (1) of this section has been committed by a body
corporate, every person who at the time of the commission of the offence was a
director, general manager, secretary or other similar officer of the body
corporate, or was purporting to act in any such capacity, shall be deemed to be
guilty of that offence unless he proves that the offence was committed without
his consent or connivance and that he exercised all such diligence to prevent
the commission of the offence as he ought to have exercised having regard to
the nature of his functions in that capacity and to all the circumstances. |
30. The Housing Act is hereby
repealed: | Repeal and saving. |
Provided that any
insured loan made or insured under or in accordance with the provisions of the
repealed Act shall be deemed to have been made or insured under or in
accordance with the corresponding provisions of this Act, and the provisions of
this Act shall apply thereto accordingly, with such adaptations and
modifications as the circumstances may require. |
SCHEDULE (Section 6) |
1. Each Housing
Commission shall consist of not less than three and not more than seven persons
appointed by the Minister. |
2. The Minister
shall appoint one of the members to be the chairman of each Commission. |
3. Any member of a
Commission shall, subject to the provisions of this Schedule, hold office for
such period, not exceeding three years, as the Minister may determine and shall
be eligible for re-appointment. |
4. The Minister
may appoint any person to act in the place of the chairman or any other member
of a Commission in case of the absence or inability of the chairman or that
member to act. |
5. (1) Any member
of a Commission other than the chairman may at any time resign his office by
instrument in writing addressed to the chairman, who shall forthwith cause it
to be forwarded to the Minister and, from the date of the receipt by the
chairman of such instrument, that member shall cease to be a member of the
Commission. |
(2) The chairman
of a Commission may at any time resign his office by instrument in writing
addressed to the Minister and, from the date of the receipt by the Minister of
such instrument, the chairman shall cease to be chairman or a member of that
Commission. |
6. The Minister
may, if he thinks it expedient so to do, at any time revoke the appointment of
the chairman or any other member of a Commission. |
7. If the number
of members of a Commission falls below the minimum number allowed by paragraph
(1) of this Schedule, the vacancy shall be filled by the appointment thereto by
the Minister of another person, who shall, subject to the provisions of this
Schedule, hold office for the remainder of the period for which the previous
member was appointed. |
8. The names of
the members of a Commission and every change in the membership thereof shall be
published in the Gazette. |
9. (1) A
Commission shall meet at such times as may be necessary or expedient for the
transaction of its business, and such meetings shall be held at such places and
times and on such days as the Commission may determine. |
(2) A quorum of a
Commission shall be three. |
(3) Subject to the
provisions of this Schedule, a Commission may regulate its own proceedings. |
(4) A decision of
a Commission may be reached by a majority. |