ECONOMY

2,300 houses to go under the hammer in December

2-300-houses-to-go-under-the-hammer-in-december

Banks are speeding up auctions of debtors properties, by themselves or through bad-loan management companies that are pushing for a significant number of properties to go under the hammer in the next few months.

In December alone, banks and servicers are planning to have 2,300 new auctions conducted, and the pace is expected to rise further from January, particularly since May sees the expiry of the protection status for borrowers’ main residences.

The deadline for protection applications through the platform at the Special Secretariat for Private Debt has been extended until April.

Banks warn that after this grace period they will exhaust all legal means at their disposal, leading to auctions the assets of all debtors who refuse to have their debt rearranged.

The increase in the number of properties to go under the hammer is also brought forward because of the large packages of loans banks are securitizing.

These are secured loans, i.e. mortgage or corporate debt guaranteed on real estate collateral, that will be acquired by funds.

The securitizations constitute a vital instrument for the reduction of nonperforming loans and will be facilitated by the operation of the asset protection scheme (“Hercules”) that the government is promoting.