How to stop more Spaniards being forced from their homes

The Spanish citizens who organised protests against house repossessions set out their demands
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We are an organisation that provides assistance to families that are to be evicted from their homes.

Thousands of families are facing dramatic situations because they cannot pay their mortgages or are on the point of discontinuing their repayments. Many have already been forced out or are undergoing foreclosure proceedings and fear that eviction is just months away. Poor banking regulation in Spain means that not only are they at risk of losing their homes, but they will also still owe some of the debt because banks are now putting lower values on those same properties.

The government is failing to put forward any solutions. The government-sponsored moratorium on some mortgages not only fails to solve the problem but defers it and makes it worse by increasing the amount of interest to be paid. Moreover, the way the moratorium is applied means that the most vulnerable families are excluded from the scheme and also banks are not obliged to sign up to it and often refuse to do so.

Foreclosed borrowers like us claim that we are the victims of a widespread mortgage fraud and abusive contract terms. It was the banks that made mortgages easy to get and granted those mortgages even though many of us were not creditworthy and were on low incomes. They used excessively high valuations, thus helping to inflate prices and further increasing indebtedness. But the list of irregularities does not stop there: charging high fees; demanding that borrowers take out over-priced and useless insurance policies; charging variable interest rates at huge spreads over the Euribor base rate; providing partial, if not actually deceitful information on possible increases in the mortgage, etc. All this with one obvious aim: to maximise profits and get round the risk control systems that any reasonable banking system should have in place.

We do not deny that we, having entered into contracts which we are no longer able to honour, must share some of the blame for this, despite the fraudulent terms on which many of these mortgages were arranged.

For years the banks, in unison with real estate developers, the government and the media, continued to tell everyone that renting was equivalent to throwing money down the drain; it was much better to buy, and property prices were never going to fall. In this climate real estate companies, banks and cajas (savings institutions) took full advantage of the situation and used the full weight of their promotional apparatus to persuade people to buy and to over-borrow.

The assembly of mortgage victims is demanding solutions. Fair, practicable solutions, the kind of solutions that are being implemented elsewhere:

a) Support for families with mortgages and mortgage guarantors facing eviction, until a solution to their difficulty can be found. Give them access to legal aid so that they can defend themselves in foreclosure proceedings. And give a guarantee that nobody will be made homeless: a democratic government that respects human rights cannot allow thousands of families to be thrown out of their homes while millions of flats lie empty while their owners wait until they can make some money from them.

b) Make it a requirement that "dation in payment" be applied retrospectively (two attempts have been made to get this through Spain's parliament but have not found sufficient support). This would mean that if a bank forecloses a mortgage and repossesses a property the debt is cleared, just as in other EU countries and in the US. In forcing people out of their homes and on top of that demanding that they pay 20,000, 50,000 or 100,000 euros, the banks are abusing their power.

c) Convert the stock of mortgaged first homes into a public reserve of rented accommodation. The government should require banks and cajas to recognise the real prices of properties and make them give up a significant portion of the unpaid mortgage amount; the government could then buy the property at the value it would have if it were a subsidised social housing unit and the former owner could continue to live in the property as a tenant under the social housing regime, provided that he or she met all the requirements to receive that benefit. In this way, not only would assistance be given to foreclosure victims, but the whole community would benefit since the supply of public rented accommodation would be increased. One version of this scheme is being implemented in the Basque Country and this could be extended to the other regions of Spain.

d) Perform a "social audit" on the working of the mortgage market. There are strong indications that ordinary citizens have been victims of a large-scale fraud that should be investigated and the liability of companies, banks and public bodies determined. The audit should also seek to discover what has happened to the millions of euros in profits that have been generated by the property boom.

e) Set up systems, make new laws and introduce policies to ensure that the provision of a decent home for people will never again turn into a business for a few and enslavement for working families. For the mortgage market, a law should be passed under which the monthly mortgage payment could not exceed 30% of the income of the borrower or family unit, for a maximum mortgage term of 20 years.

In the first three months of the year Spain has evicted 15,491 families from their homes.

We have now succeeded in halting more than 30 eviction processes in the whole of Spain. The Madrid branch, which started just 15 days ago, has stopped two evictions.

We will continue to fight to for people's right to dignity.

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