Photo: Housing in Colomiba to Get a Boost
The Inter-American Development Bank (IDB) will contribute to reduce the housing shortage in the most backward sectors of Colombia through a credit guarantee of 9.5 billion Colombian pesos (some US$5.38 million) granted to Credifamilia Compañía de Financiamiento S.A., which specializes in mortgage loans for social housing.
This guarantee will enable Credifamilia to access a 9 billion pesos loan from the Inter-American Investment Corporation (IIC) to finance its mortgage loan portfolio and at the same time attract additional financing from the market. It is estimated that these funds—at a term of five years, which is impossible to secure on the Colombian market—would allow Credifamilia to grant some 16,000 mortgages in late 2016 for a value of some US$590 million.
The project seeks to put right the coordination deficiencies that affect the housing sector in Colombia, which will target low-income individuals through a network of commercial offices in association with large housing construction companies in Colombia. Historically, banks have had limited interest in financing this segment due to the high administration costs and risk perceptions.
Credifamilia will cater to this sector efficiently by using modern IT tools to handle the loans; incorporating micro-credit methodologies in rating self-employed workers to improve risk management; rapidly reaching scales through partnerships with housing construction companies; and leveraging official subsidies to attract lower-income sectors.