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The default in mortgages reaches 5,1% due to the crisis and the refinancing.

After five years, the effects of the crisis are starting to be felt on mortgages from families. Their default has reached 5,1% in June doubling in two years. Spanish banks and the authorities have always defended that residential mortgages would not be a problem: in spite of the crisis, in Spain, the last thing anyone fails to pay is their home. In fact, the default in this segment of credits is still less than half the general average but even so, it has exceeded 5%, a figure which was unthinkable a few years back.

The figures published today by the Bank of Spain, corresponding to the first semester, show that out of the total financing granted for the acquisition of homes, 31.916 million Euros are default. In only three months, the default rate has increased one percentage point, from 4,162% up to 5,159%. In June 2012, this rate reached 3,23%.

The disastrous situation of the Spanish labor market, with 1,8 million families with all their members unemployed, is one of the main reasons for the increase in mortgage default. The Bank of Spain has also toughened the requirements for banks for the refinancing of their credits, a practice institutions have used commonly in their mortgages. The consequence is that banks have started to classify as default many credits which would have been considered normal earlier.

The financing for the acquisition of a home is also decreasing, a path which started in 2008. It has reached 618.663 million Euros.