For U.S.-based conventional lenders, and even for many private lenders, lending for real estate acquisition or development in Jamaica is an automatic non-starter. However, the region is an untapped opportunity in serious need of capital investment, and developers are eager to expand in the region.
Jamaica is a developing country that has been plagued by slow economic growth, largely due to the dearth of foreign capital investment from wealthier countries like the U.S. The region has also seen its share of hurricanes and other serious natural disasters. In many cases, private capital is sorely needed to fund projects that will restore Caribbean communities.
The primary reason traditional and private lenders avoid Jamaica, and the Caribbean as a whole, is their unfamiliarity with the region’s regulations. Not only are approval processes different, but the way lenders can foreclose on delinquent properties can vary as well. That, coupled with the discomfort some lenders have with a property that’s not easily accessible, sets the stage for a risky proposition that risk-averse lenders aren’t willing to tackle.
That fear and uncertainty among traditional real estate lenders in the U.S. has led to a vacuum of capital in the Caribbean. However, despite the difficult economic environment and the struggle to access capital from the U.S., Jamaica’s construction sector has continued to show promise. With proper access to capital, this fledgling economy could finally get the boost it needs to spur growth across the board.
This vacuum has presented a massive opportunity for direct private lenders who understand the potential in Jamaica, but it’s not an easy task to just begin lending in the region. The right lender must have a strong network of trusted appraisers, attorneys and other experts on the ground, a track record of successful closings in Jamaica, and they must be fluent in Jamaica’s regulations themselves, not just dependent on other connections in the region.
“Total compliance with the law, and thorough knowledge of all regulations, is the only way to succeed when working to secure a loan for a property in Jamaica,” said Kevin Wolfer, CEO, Kennedy Funding. “Working with an experienced, trusted partner is key to closing a loan with a U.S.-based lender in this region of the world.”
Direct private lenders are free of the constraints that keep conventional lenders at bay in Jamaica. Where banks see too much risk, direct private lenders are free to see grand opportunity. For a young economy in need of a kickstart, like Jamaica’s, private lending presents an effective solution to the lack of access to capital markets. The only trick is finding a lending partner that is well-versed enough to make smart investments that will result in real economic development.
Kennedy Funding is one of the only direct private lenders closing loans in Jamaica. The firm’s knowledge and experience in the region play a key part in properly surveying a property, appraising its value and sizing up the opportunity at hand. Contact Kennedy Funding to learn more about how to secure a loan for a deal in Jamaica.