Re: Re: Hypothetical question – mortgages and Euro

#108892
Anonymous
Participant

Thank you for the reply.
But that raises the question of how on earth the local mortgagors – who would be earning pesetas after the changeover – could ever hope to repay the loans, in euros, which they are struggling to pay now. If the peseta (or, in the case of Greece, the drachma,) were to fall in value by, say, 50 % the balances due on the local mortgages would effectively increase by 100%.
I wonder if it is politically possible for a country to leave the euro and not, then, convert its domestic loans and mortgages into local currency liabilities. Of course non residents could well be treated differently.