Economy Minister, Luis de Guindos has called for a “code of practice” to be drawn up for banks to help struggling home owners to stay in their home and reduce their debt.
Speaking in parliament today, Sr. de Guindos called for an end to the “human tragedy” caused when a family is evicted, effectively making them homeless.
“This situation is a human tragedy,” de Guindos said. “The government is very sensitive to the situation created by the large number of evictions which are affecting a large number of citizens.”
“What the government is going to try to do is protect a segment of the population, which because of the economic crisis and as a consequence of the errors of the past, may find itself in a very difficult situation,” de Guindos added.
The minister called for steps to be taken to allow defaulting home owners to write off their mortgage by handing the property back to the bank, sparing them from accumulating further debt.
The code will not be there as a get-out-of-jail-free card for everyone with debt problems. It will be there to provide help for families that fall under a definition of economic exclusion, which has yet to be defined. Those that will benefit are likely to be families in the lowest income bracket, or with no income, and with no additional assets.
Official figures show that nearly 43,000 evictions were carried out in the first nine months of 2011, just under 5,000 fewer than the total for the previous year, which was 47,800.
Over recent months campaign group PAH has staged a series of protests on the doorsteps of home owners awaiting eviction. In a statement the group said a code of conduct was not enough to protect families or provide assistance for those already evicted.
“We do not need recommendations but legislation that guarantees that citizen’s fundamental rights will be protected,” the statement said. It also went on to say that appealing to the good will of the banks with a “voluntary” code would not work because these are companies whose only reason to exist is to get maximum profit from it’s customers.
Luis de Guindos is a former Lehman Brothers executive, appointed by Mariano Rajoy, so I have to wonder how on earth he managed to get a job as a government minister in a country still suffering from the damage Lehman Brothers caused.