Desperate to shift their fast growing stock of repossessions, Spanish banks and cajas – savings banks – are reported to be offering preferential mortgage terms such as lower premiums and arrangement fees to clients who take a property off their hands.
Banks are also reported to be offering price discounts of up to 30% get rid of the properties being forced on them by bankrupt developers and defaulting mortgage clients.
Developers are screaming blue murder, accusing the banks of “unfair competition”. The last thing that struggling developers need now are the banks undercutting them on property prices and mortgage terms.
Fortunately for developers, the properties the banks end up trying to sell are often not that attractive, which is why they end up on the banks’ books.