Greece Mulls Lifting Home Seizure Ban



greek home11Despite a lingering economic crisis, the coalition government led by Prime Minister and New Democracy Conservative leader Antonis Samaras wants to lift a ban on repossession of homes of people who can’t afford to pay mortgages with their pay cut, tax hikes and pensions slashed and will allow banks to seize them and sell them off.

Deputy Development Minister Thanasis Skordas suggested that there could be a partial lifting on the ban from next year based on criteria that include the size of the mortgage and the homeowner’s family and financial situation.

While austerity measures have reduced Greek purchasing power some 46 percent, many banks have not allowed restructuring of loans and mortgages even though the level of non-performing loans has risen to 27.8 percent.

The government has reportedly been squeezed by the banks not to renew the ban so that they can take people’s homes and sell them.  The ban on auctions of main residences worth up to 200,000 euros ($260,000) expires at the end of the year.

The banks are backed by the International Monetary Fund, (IMF) one of Greece’s international lenders which wants the government to take the properties of people who can’t pay banks, fearing that the agency could be at risk of not getting its share of loans to the government repaid one day.

An IMF report stressed that banks will need to start cleaning up the problematic elements in their portfolios in order for the economy to receive a cash boost even if that means people will lose their homes.

Ironically, Samaras’ party and that of his coalition partner, the PASOK Socialists, owe banks 250 million euros ($332 million) in bad loans but there were no reports of banks trying to collect as they await more government funding for recapitalization.

Consumer credit is doing the worst, with 42.4 percent of loans being considered as bad, against 22.9 percent in mortgage loans and 27.5 percent in corporate credit, adding up to 63.5 billion euros ($84.32 billion) not being paid, a total more than the $70 billion owed by tax evaders, or 34 percent of the country’s Gross Domestic Product (GDP).

This breaks down to 12.5 billion euros ($16.6 billion) in NPLs in consumer credit, 16.8 billion euros ($22.3 billion) in housing loans and 30.3 billion euros ($40.23 billion) in corporate credit, according to data compiled by the Bank of Greece.

The ban on repossessions is believed to have saved 200,000 homes from being taken in the last five years but banks said they must be able to collect what is legally due them even if it means people lose their residences at auction.

But so sensitive is the issue that even members of the ruling parties, already beleaguered by constant backing of austerity that have made them wildly unpopular, don’t want to touch it.

New Democracy MP Sofia Voultepsi said there was no way she would discuss the auctioning of homes and PASOK deputy Paris Koukoulopous said Parliament would never accept such a measure. The coalition has a five-vote majority in the 300-member body.

 


13 COMMENTS

  1. If Greece needs more cash then why isn’t the Bankers, TROIKA & PRESS asking where 250 million Euros went that PASOK & ND Parties took out in “phony” bank loans from their Banker cronies, and never even paid a cent back after 10 years?

    Is that a show of their good Governance and Gov’t Management skills? Into
    whose greedy dirty pockets did the 100s of millions of Euros lost go into?

    Why isn’t the Greek Justice System & Press asking any questions? Could it be they are all in the same rotten bed together..?

    No worry, come September there wiil be a massive Greek Protest on Parliament who will RISE UP and throw these rotten Politicians out of office and jail them!

  2. Street corners will be full of homeless…A showdown against the goverment who caused this crisis must take place and soon…Home repossessions must start with politicians homes first followed by tax evaders and government parasites…

  3. Worldarts…The 250 Million have been covered-up and no one dare to ask where this money has gone…All politicians past and present are covering-up for each other so it will be very hard to for Troika to ask and for the Press to dig for more details…Remember that the press is with the government so save your breath because you won’t get any answers…

  4. Well it is correct for a bank to seize its asset if it cannot receive its principle mortgage. Here in Canada that is legal. But the thing is the whole system in Greece is a mess from the beginning. The banks are at fault since they took the risk to issue mortgages to basically anyone. Now since most loans are NPL and real estate prices have dropped by around 40% the banks are screwed. But im suprised all these years the banks didnt at least restructure the mortgages to people if they new they would become NPL. Sure seems like nothing in Greece functions properly. Also property prices in most of Greece make absolutly no sense as they are way over valued in comparison to income affordability and buying vs renting. Nothing makes sense in Greece.

  5. The same thing has been happening in the US where the predatory banks, who act like masters of the universe, made mortgage loans to people who couldn’t afford them.

    The US government “ordered” the banks to restructure the mortgage loans and negotiate reasonable payment plans with homeowners rather than putting homeowners into default and repossessing homes. But bank executives, who are basically mafia-style loan sharks, ignored that advice and have been routinely putting people on the street.

    The corporate-owned media has been complicit by under-reporting the size and frequency of organized public protests against Wall St. and harsh austerity measures (like “the sequester”).

    So, it’s not GREECE that doesn’t make sense. The system makes perfect sense if you’re one of the masters of the universe who has rigged the system against the 99%.

    This pattern exists in almost every developed or developing country: Big Lenders make bad loans to people (for homes etc.) and governments (for wars etc.) knowing that there is no downside to making a bad loan because because the governments/politicians will take full responsibility (on behalf of the 99%) for making sure banks get repaid. This is called privatizing the gains and socializing the losses. That’s how we ended up bailing out the banks at 100% against our wishes…our politicians picked our pockets and damaged our economies just to make sure the banks got paid. They are all part of the same plutocracy after all.

    It’s always the 99% who get screwed…losing their life savings, their home, even their job.

    This is how the super-wealthy take possession of the world’s land and resources. This is how the plutocracy turns the rest of us into peasants whom they can exploit into perpetuity as they themselves become richer and more deeply entrenched in their power and ownership.

    I know all this sounds like hyperbole, but it’s not. This is why bloody revolutions happened throughout all of history everywhere in the world and will happen throughout the Western world too — in this century I’m sure.

  6. Yes, the press is in bed with private industry and works to keep the Greek people misinformed and confused. Greece very badly needs an incorruptible leftist leader like Ecuador’s Rafael Correa.

  7. Greeks should demand that the IMF provide the bank records for the past 20-30 years for all of the industrialists, politicians, journalists and self-employed people. With those records, you can know what taxes they owed and you can confiscate their assets to retrieve as much of the lost tax revenue as possible.

    Demand the cooperation of the Swiss banks, where much of the money must be hiding.

    Then, once you have recovered as much of the lost tax revenue as possible, break away permanently from the EU. And re-start your democracy. But you need to impose iron-fisted tax collection. No tax evaders! And no privatization of public assets and NO corruption.

  8. The Greek or World Press has not said a word lately about the Swiss Banks or Venizelos hiding all the Legarde List’s with 2,069 rich Greek elites or Politician’s money hidden for 20 years there…
    Time to clean the slate and make the sleazy SWISS open up their phoney bank accounts secrecy that they’ve had there since back when they worked for good old Hitler to hide his gold and cash too he looted from all over Europe~!! THIS B.S. HAS TO STOP !

  9. Have they no shame left, even after they all have been caught red handed in the cookie jar?

  10. Our corrupt Greek politicians have no shame when steeling our money…They have blood in their hands and they will be remembered for their actions…They are traitors and will remain traitors in history for ever…History cannot be erased…

  11. “The banks are backed by the International Monetary Fund, (IMF) one of Greece’s international lenders which wants the government to take the properties of people who can’t pay banks, fearing that the agency could be at risk of not getting its share of loans to the government repaid one day.
    An IMF report stressed that banks will need to start cleaning up the problematic elements in their portfolios in order for the economy to receive a cash boost even if that means people will lose their homes.”

    I see Lagarde of the IMF is now getting worried about getting “her” money back & is showing her true colours. She doesn’t care if thousands of Greek families are thrown on the streets as long as she gets the money. Why are the Greek people standing for all the misery that is being imposed just to save a currency, the Euro. Are the Greek government drugging the water supplies to make it’s people lethargic like Hitler intended doing with Britain? For Gods sake Greeks, WAKE UP. Your politicians are paid by YOU, they are there to look after YOUR interests. Hmm, that’s a joke when the two parties that caused this mess are STILL running Greece