Minister of Finance, Economic Affairs, and Primary Sector, Mr. Geoffrey Wever, confirmed that the Cabinet has approved a decision to relax the mortgage conditions at Volkskredietbank (VKB) in Aruba. This decision is aimed at improving access to affordable financing, reducing debt-related issues, and offering more flexibility for families.
Volkskredietbank Aruba (VKB) has the goal of meeting the credit needs of Aruba’s population in a socially responsible manner, with its operations regulated by the “Landsbesluit inrichting en werkwijze Volkskredietbank (LbVKB).”
The previous 8% interest rate on mortgages is no longer applicable. Instead, VKB will apply an interest rate ranging from a minimum of 6% to a maximum of 8%, depending on the client’s risk profile. The interest for each risk group will be determined based on a proposal from VKB’s director, with approval from the Board of Commissioners.
This change in policy aims to bring interest rates more in line with the social and economic realities of the island. A lower interest rate will provide more room for debt consolidation and improve access to credit for older adults and other groups. VKB believes that this flexibility in interest management will contribute to solving the problem of “over-indebtedness.”
Additionally, the policy change gives VKB the option to offer a second mortgage if the client’s first mortgage with VKB is fully paid. This will reduce the costs for a second mortgage, as it allows for savings in registration and notarization expenses.
The new policy is effective immediately. The Cabinet has also approved the early implementation of these changes, pending the formal modification of the landsbesluit, so clients can immediately benefit from the new conditions. With this action, the AVP-FUTURO Cabinet reaffirms its commitment to responsible credit management, affordable housing finance, and the prevention of excessive credit in Aruba, according to Minister Geoffrey Wever.
