Professional Documents
Culture Documents
August 2016
Briefing
Legal framework
Licensing requirements
Classification of mortgages
Classification of Mortgages is done by applying a
combination of two criteria i.e. qualitative and quantitative
criteria. The qualitative approach focuses on the
performance of the mortgage, while the quantitative
approach focuses on the outstanding mortgage and the
number of due days that have passed.
Mortgages are classified into five categories namely; current,
especially mentioned, substandard, doubtful and loss.
Further information
If you would like further information
on any issue raised in this update
please contact:
Peter Kasanda
Michaela Marandu
Tenda Msinjili
Current Mortgage
Loss Mortgage
Substandard Mortgage
Doubtful Mortgage
A mortgage is classified as doubtful if:
a. It was classified as substandard in
the last quarterly review without
significant improvement in terms of
full payment
b. It is a past due mortgage secured by
a title which is subject to an adverse
claim
c. It is a mortgage with an extremely
high possibility of loss but for some
reasons and factors, that may work
to the advantage of the mortgage, its
classification as an estimated loss is
deferred