• Most of it is concentrated in Andalusia and Catalonia, followed by the Valencian Community.
  • In 594 cases the debt was restructured and in 298 the payment date was agreed.

A total of 4,385 mortgage debtors have applied for the Code of Good Practice (CBP) during the first year of operation. The petitions have been submitted to 27 banks and 19 credit unions and the outstanding debt reaches 582.7 million euros. Of the 4,385 applications, 1,063 were pending processing at the end of the first quarter of 2013 (24% of the total). Of the 3,322 already processed, in 594 cases the debt was restructured, another 298 ended up in payment, 238 withdrew, 2 with a withdrawal and 2,190 were denied for not meeting the requirements.

The CBP was launched in April 2012 and currently has 97 member entities, almost all of which have mortgage activity in Spain. Its objective is to protect debtors who cannot cope with the mortgage payment as a result of the crisis. The CBP allows the debtor to restructure the debt, set a take-off and, ultimately, the payment date. Adherence to the CBP is voluntary by financial institutions, but once completed, compliance is mandatory for a period of two years.

During this first year of operation, applications for accession to the CBP have been increasing at a strong pace. In the second quarter of 2012, 564 applications were received, 722 in the third, 1,132 in the fourth and 1,967 in the first of 2013 (more than 44.8% of the total). Of the total accumulated in this first year, most of the applications have been made in Andalusia (1,156), Catalonia (1,028), Valencian Community (755), Madrid (364) and Murcia (315). These five communities concentrate 82.51% of the total applications. By provinces, the one that concentrates the most is Barcelona (809) and the least, Huesca (1).

Regarding the resolution of the applications processed at the end of the first quarter of this year, 2,190 were denied and 894 made. In another 238 cases, the debtor withdrew, without determining the causes. In 594 cases (66.4% of those resolved and 17.88% of the files processed) the debt was restructured. In 298 cases (33.3% and 8.97%, respectively) the payment date and the subsequent cancellation of the debt were agreed. In two cases, a take-off was agreed.

The refusals responded that the loan or credit did not meet the requirements established in the standard (45%), lack of delivery of documentation (29.4%) or breach of income thresholds or family situation to qualify for (21.55 %). These thresholds have been raised in the amendment that has just been approved by the Senate and will take effect in the coming days. For example, the IPREM (1,597.53 euros per month) is raised up to the level of family income to qualify for the CBP, the value of the mortgage (between 240,000 and 400,000 euros depending on the number of inhabitants of the city where the property), among other improvements. With these measures, the number of refusals can be expected to fall significantly as of next quarter.

Taking into account, on the other hand, that in 2012 there were 2,405 judicial deliveries of occupied housing, according to data published on May 10 by the Bank of Spain, it can be concluded that the CBP, with 1,134 applications accepted, is an instrument useful for mortgage debtors who are at the threshold of exclusion and have difficulty coping with the payment of their debt.

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