Realtors required to ask for clients' source of funds to buy a house

 

Past President of the Realtors Association of Jamaica, Howard Johnson Jr., says realtors are mandated by law to request information about source of funds from their clients seeking to purchase a house.  

 

This comes in the wake of a conversation on social media platform X, where users shared deep reservations about providing real estate agents with information about their source of funds.

 

Some have argued that it is an invasion of their privacy and questioned whether realtors are trying to determine if they can afford to buy a house before allowing them to view it.

 

But Mr. Johnson, who was a guest Wednesday on the Morning Agenda on Power 106FM, explained that proof of source of funds is to show that money being used to purchase the property was legitimately obtained to prevent money laundering.

 

"That's part of the anti-money laundering regime that we are now mandated to observe. And in our Know Your Customer, we have to identify how are these persons going to purchase. So if it's cash, we need to get a letter from the bank or we need to know the authenticity of that cash resource, or if we are getting a mortgage, we need to know that you're pre-qualified," he outlined. 

 

Mr. Johnson said a similar approach is also taken with people who are renting a property. 

 

"For rental, we also have to do that due diligence on behalf of the landlord because oftentimes you would hear of the stories...where you have horror tenants. They afford it for the first month or two and then there's no sustainable income thereafter."

 

He noted that because of the cultural dynamics in the country, "there are certain things that we must adhere to for better governance to protect all stakeholders - landlords, sellers, and the buyers and ultimately the tenants".