Housing Corporation stands by Prohibition Order
Guarantors are legally bound by the law to pay loans after they sign an agreement.
This is the view of the Samoa Housing Corporation (S.H.C.) Chief Executive Officer, Mata’utia Rula Levi, in response to concerns raised by a guarantor, Andre Belford, after he was stopped at the Faleolo International Airport from leaving the country.
“The problem is the majority of guarantors take this responsibility lightly," Mata'utia told the Samoa Observer.
"However that mindset must change. Your signature means that you will pay the loan once it's defaulted."
“The entire arrears for the housing is 2.6 per cent ($1.35 million) of our entire portfolio of $52 million, hence exhausting every option we have to track those with unpaid loans, including the guarantors.
“We have issued hundreds of prohibition orders to stop people from leaving Samoa without clearing their loans."
The prohibition order is an effective way of getting the guarantor to repay outstanding loans with the Corporation, added Mata’utia.
But Mr. Belford, who guaranteed a loan for someone with the Corporation, disagreed.
He was stopped at the Faleolo International Airport when he was boarding a flight to New Zealand. He expressed disappointment with the Corporation's course of action.
“In the last couple of years, I have been stopped at the airport on my way back to New Zealand due to a restraining order through Customs by Samoa Housing," he said.
"It was shocking given my history before moving overseas, I have never had any loans at Samoa Housing.”
His attempts to make alternative arrangements with the authorities was also knocked back, and he later found out that the person he acted for as guarantor had passed on.
“The next day, I discovered that it was an outstanding loan of someone that I was a guarantor for more than 10 years at the time, and only found out the person has already passed away.”
Mr. Belford said paying off the outstanding loan is understandable.
“However, the lack of information and poor processes cost travel people, not Samoa Housing. I should’ve been informed on my arrival,” he said.
“If Samoa Housing can inform me through Custom on my departure, they should be able to do the same on my arrival.
"There are hard working families like us that when we come to Samoa, we make sure we get back on time to New Zealand for work commitments to support our families in Samoa," he said.
But the C.E.O. of Housing would not take any of it and is adamant that the policies they have in place addresses the issue.
“The Housing has policies in place for the guarantors to follow before they move overseas.
“They can come into the office, inform us they are moving overseas and we can make the necessary arrangements or they can bring in the borrower and they can get another guarantor.
“But you can’t sign the loan agreement with the borrower and the housing and then leave Samoa without informing the S.H.C.”
Mata’utia emphasised that there are ways to handle these issues which often happen, while reiterating that the Corporation can only use a guarantor to recover funds.
“Also if the loans are not paid, how can we service a long line of clients waiting for financial assistance for their homes,” she said.
For Mr. Belford, he told the Samoa Observer that as someone who visits Samoa every three-six months, "I felt that I had been robbed".
“I felt that I had been robbed trying to make an arrangement at the spot, due to myself wanting to leave the country for urgent work was like hitting the brick wall.
“I am fortunate to work in a job that people did understand my circumstances, but that call might lose your job here in New Zealand, and as you know, that job is a key factor for families here and especially supporting families in Samoa.
“Arrangements and having someone from Samoa Housing at the time to call will be more appreciated by us here.
“We are not going anywhere, we are here in New Zealand working day and night to invest in our country through our families. Something to think about to engaged us more to Samoa Housing.”
He also said the prohibition order was costly to him as he had to rebook and repay his airfare when he did not travel.
“I had to rebook and repay my airfare. My wife had to take time off from work so that she can send of money to Samoa to pay the loan, so I can leave Samoa.
“As stated, I have accepted paying as a guarantor. If this have been picked up on my arrival, I wouldn’t have gone through this, as I will have the time to sort it out before my departure,” he said.