Tough mortgage laws in Spain have allowed banks to evict more than 400,000 people since the 2008 economic crisis hit and the housing market subsequently collapsed. Our Observer explains how a grassroots movement in Granada is successfully forcing banks to drop plans to evict people by holding sit-in protests on their premises.
Imagine losing your job, failing to make your mortgage payments and then finding out the house you bought ten years ago is worth €100,000, instead of the €450,000 you paid for it. The bank repossesses your home, but by law you still have to pay back the full mortgage, complete with interest and late fees, even after you have been evicted. Debt-laden, unemployed and evicted: this is the plight of hundreds of thousands of Spaniards who have been hit hard by the toxic combination of an economic crisis, austerity measures and harsh housing laws.
In a bid to reduce Spain’s 10.6-percent budget deficit, Prime Minister Mariano Rajoy’s government has increased taxes and made big cuts in public spending, including health, education, unemployment benefits and pensions. Civil service jobs and pay have been slashed and unemployment in Spain stands at 26 percent.
As banks continue to evict, there are 3.4 million empty homes in Spain – nearly 14 percent of the total housing stock – most of which is owned by banks. A series of suicides by evicted citizens and those on the verge of eviction thrust the crisis into the spotlight and put banks and the government under fire from the media and the EU.
In March this year, the EU Court of Justice ruled that Spanish law gave “incomplete and insufficient” protection for mortgage holders and ruled in favour of giving Spanish courts new powers to delay evictions. Before the ruling, Spanish law meant citizens faced eviction if they fell behind on the mortgage repayments by just a month.
The ruling was a victory for campaigners, but they feel the battle is far from won: the ruling merely delays evictions. Spaniards forced out of their homes are still finding themselves legally obliged to pay back mortgages even after they have handed over the keys.
"If it doesn’t work the first time, we try again and in the end the bank always gives in"
Eduardo Perez is a member of the Granada-based movement 'Stop Desahucios Granada' [Stop Evictions], which is part of the wider movement ‘Plataforma de Afectados por la Hipoteca’ [Platform for those Affected by Mortgages, or PAH]. He has been unemployed for one year.
We’re trying to give everyone the right to a home. In Spain, mortgage laws are the worst in Europe: the banks kick you out and you keep the debt. Even in Greece, which has bigger economic and social problems than us, they don’t kick you out on the street.When a family is told they are going to be evicted, we go to the bank to propose an offer. When a bank refuses our offer we ask our members to take part in an ‘action’ at the bank.
'Stop Desahucios Granada' protesters gathering outside Deutsche Bank in Granada on July 18. Deutsche Bank later agreed to their offer.
We choose a normal working day, so the bank is open, but we still get lots of people coming down because so many people in Granada are unemployed nowadays [Editor’s note: Granada is in the region of Andalusia, where unemployment stands at 36 percent, 10 percent higher than the national average].We stand outside the bank, blocking the door, and sometimes we even go inside, demanding the bank agree to not evict the family. It’s really bad publicity for the bank, because they can’t work, their clients can’t get inside, and we warn their clients about how bad their bank’s behaviour is.
'Ocupacion': Stop Desahucios protesters occupying Cajamar bank in Granada on July 24. Cajamar later agreed to their offer.
If it doesn’t work the first time, we try again and in the end the bank always gives in. We’re not asking for the moon: our requests are reasonable.We’ve stopped about 200 evictions in Granada since we started two years ago. But that figure only counts evictions that were just about to happen: we’ve stopped many more in the early stages through negotiation. We always try to solve the problem first by negotiating an offer with the bank. In the last five months, we’ve stopped about thirty evictions through negotiation.One type of offer involves the family giving the house to the bank, the debt is erased, and the bank and the family agree on a monthly rent. But the problem here is that the agreement is signed for a number of years, and when the time is up, the family will be faced with the same initial problem.Another solution is restructuring the mortgage, which is best for everyone because the bank will always be paid the full amount, but just over a longer time period, and the family will eventually own the property.
An emotional moment: the man and woman in the centre have just signed a social housing agreement with Caixabank. The bank accepted to take posession of their house as payment for their mortgage debt. The family will pay the bank a monthly rent of 82€ for the next two years, with the possibility of extending the agreement after this period.
When we first started out in 2011, the negotiation was harder because the banks didn’t feel obliged to negotiate: they thought they were the masters of Spain! There are so many empty houses here, so banks don’t want to repossess a house in exchange for wiping out someone’s debt. But then our movement grew, and the media showed us support, and this forced the banks to retreat a little.But the majority of people with unaffordable mortgages are still being evicted: we can only help when we hear about an eviction, so there are families facing problems that don’t get to us.Article 47 of the Spanish Constitution states that "Every Spaniard has the right to enjoy decent and suitable housing". Of course, this right is, as we say in Spanish, ‘wet paper’: pure fiction. Since the constitution was signed in 1978, the people running politics and the economy have always called the Constitution "sacred", but they always forget the articles that talk about social rights.
A 'Stop Desahucios' local assembly in La Zubia, a town near the city of Granada.