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Mortgage debtors in Chile are holding high-profile protests.
Cuello has been paying off his mortgage for 18 years now, and is now 30 payments behind. He has nine years left to go to pay for his 52-square-meter house, which he bought when it had an unfinished electric system, no doorknobs, no separations between bedrooms and a cement floor.
The Special Program for Workers (PET, in Spanish) Cuello applied to was set up in 1985 and, according to the Housing Ministry, was aimed to help middle-income families. It consisted of three-part financing: family savings, a government subsidy and a bank loan.
Today, the ministry says that the issue of these mortgages is a private matter involving the debtors and banks. “These families have known from the very beginning what the conditions were," said Juan Pino, head of the mortgage portfolio unit of the Housing Ministry. "The Housing Ministry did not provide these loans — this was a contract between the debtor and a financial institution."
But Ivan Carrasco, national leader of Andha-Chile, disagrees. “This is not a problem between citizens and private banks. This is a result of government housing policies implemented in the past," he said.
The government has written off the remaining debts of some low-income mortgage holders who were part of state programs. Two years ago, Bachelet announced the cancellation of subsidies for the remaining debt of about 93,000 state-subsidized homeowners.
And while the government says it isn't responsible for homeowners like Cuello, who were in the PET program, it has tried to assist them. In 2007, Bachelet said that the government would help them renegotiate their debts at current market interest rates.
This year, she promised that the government would study the cases of the most vulnerable families, and she recently offered to subsidize 50 percent of the mortgage payments of those most in need.
For Andha and other similar orgnizations, the government's efforts don't suffice. They say the proposals would benefit few, and that the renegotiated debts would drag on. Moreover, they say, if a family fails to pay for three consecutive months, the house would be automatically auctioned off.
Andha member Gloria Pomer is way behind in her payments due to her husband’s long periods of unemployment. “In my neighborhood committee of 100 families, there are people with catastrophic illnesses, or who can barely live off their pensions. I have a 70-year-old neighbor who receives a monthly pension of $90, but her mortgage is $120. She asks me: ‘What should I do, pay mortgage or eat?’ She prefers to eat,” Pomer said.
Pomer, a 50-year-old housewife, has participated in Andha for four years. She is now camping out by the river. Her participation in the group has prompted problems with her family at home. “But we have to get out on the streets,” she said. “It’s the only way the government will listen.”
Pomer has lost track of how many times she’s been arrested. Now, she and her fellow Andha members are threatening to bar all candidates up for election in December from their neighborhoods until their demands are met. And they mean it.
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