Less than three years after the launch of Federico Sturzenegger's mortgages, there was the feared scenario: that inflation would soar as to make the quotas unpayable for the debtors of these mortgages. In November, the coefficient of salary variation was 20.6 percentage points higher than the year-on-year inflation and more than 34 thousand debtors were able to renegotiate with the creditor banks an expansion of the payment term of the debt.
Wages lose 14% against inflation through November
UVA credits, described by Carlos Melconian – among others – as "a fraud for the debtor", were born as a credit instrument that transfers all risks of mismatching the creditor to the debtor and leaves the banks with an interest rate free of all risks except for insolvency – which is virtually nil because the mortgaged property serves as collateral.
Therefore, the debtor assumes within the UVA (Adjustable Value Unit) the variation of inflation – which historically tends to converge with the value of the dollar – even if its income is not subject to the same updating process.
When these credits were launched in the first half of 2016, Sturzenegger introduced them as the way to buy a four-bedroom apartment with an income of just over $ 10,000 a month. At that time, the inflation target for 2018 was 10%.
And that point was crucial in the evolution of payments. If inflation accelerated, so did quotas. But not only the quota, but the remaining debt value measured in pesos. Therefore, as the LPO anticipates, before the two years of UVAs presented, those who had taken credit with this instrument and were 40% more in pesos, although they were canceling the installments in time and in form. The earlier an inflation peak, the greater the proportion of debt reached by the adjustment.
They warn that those who took UVA credits were already 40% more than 19 months ago
Fearing that there was a very large gap between wages and mortgage payments, which could become a mass standard, the government decided to implement a valve to decompress the quotas. If inflation exceeds the wage variation coefficient (CVS) by more than 10%, the possibility of requesting the extension of the payment term of up to 25% of the original term is opened for debtors. Thus, a client who applied for a 20-year mortgage can extend the date of cancellation of their debt to 25 years.
The limit is two extensions per credit and, for that reason, analysts warn that it would be a priceless or "eternal" credit. Carlos Melconian, then head of Banco Nacin, was directly opposed to this instrument and, instead of receiving credit from UVA linked to inflation, established a more demanding plan in its initial conditions, but linked to the evolution of wages.
It should be noted that so far there was no record of massive defaults on mortgage loans, but there were increases in defaults on the repayment of promissory loans with these instruments.
According to the public TN.com, according to estimates by the Housing Secretary, which depends on Ivan Kerr, there will be more than 34,000 debtors in a position to now claim for the first time the extension of the mortgage debt clause. Most debtors have signed their contracts between July and December 2017.
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