Mortgages Approved During the Real Estate Bubble Responsible For 62% of All Foreclosures

Two out of three property foreclosures (62.6%) initiated or entered in the books during the first quarter of the ongoing year corresponded to mortgages granted in the real estate peak years 2005-2008. This fact is revealed in the Foreclosure Statistics report published yesterday by Spain´s National Institute of Statistics (or INE).

During that period of time, the years 2006 and 2007 provoked now the biggest number of repossessions (38.5%). Moreover, 2007 marks the highest rate of mortgage execution (0.29%) ,whereas the years 2008 and 2006 showed 0.27%. The data proves the excessive lending during the real estate fever just before the recession.

In general terms, there have been 9.464 foreclosures of the main residence homes by the end of March, by 19.1% more than in Q4 2013. In turn, compared with the Q1 2013, the number declines by 4.2%.

By Spanish regions, Andalusia leads in the foreclosure ranking with 4.373 repossession processes ongoing in the first quarter of 2014. The second ranks Catalonia with 3.993, followed by the Valencian Community with 2.726 foreclosures. On the other end, one may find La Rioja with only 37 trials, Navarra with 102 and the Basque Country with 122 property seizures.

The first quarter saw 32.565 initiated foreclosure processes, by 10% more than in Q4 2013 and by 19.5% more than in Q1 2013. Urban property was seized by 10.5% times more until reaching 31.054 cases.

Andalusia takes the lead again with 8.034 repossessions, followed by Catalonia with 5.792 and the Valencian Community with 4.282 open proceedings.

The data arouse voices about indifference of the Government about the evicted families and pointed at the weakness of the mortgage law in Spain.

Original article: El Mundo (by Daniel Viaña)
Translation: AURA REE

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