Fernando Medina reaffirmed his intention to create a mechanism with the aim of “stabilizing payments (of housing loans) for a certain period”, in order to “restore peace of mind” to the Portuguese. But details are expected to be revealed next week.
The Minister of Finance had already revealed in July that the objective is to stabilize the value of mortgage loan installments for two years, given the rise in interest rates, which he reaffirmed this Wednesday after the social consultation meeting. Additionally, the Government is working to expand interest subsidies.
More support to cover interest on home loans. Medina announces greater bonus (not knowing scope) and fixed rate for everyone
This edition of Expresso states that the Government is working on a solution for all families with housing credit, regardless of their income, which provides for an initial reduction in the installment that will be offset in subsequent installments until the end of the repayment period. According to the newspaper, families end up paying the same amount over the life of the loan, but the burdens will be spread over a longer period. One of the Government’s concerns, Expresso also points out, is that this moratorium model does not have a negative impact on the banks.
This Friday, in statements prior to the Eurogroup meeting in Santiago de Compostela, the Minister of Finance stated that the issue of the new increase in interest rates will be one of the fundamental points of the meeting with his counterparts. The European Central Bank’s decision poses challenges to economic growth and is likely to slow down. Medina pointed out that “raising interest rates would be a greater risk to the progress of the economy than not having done so.”
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The package of measures will be presented at the next Council of Ministers, as the Minister of the Presidency, Mariana Vieira da Silva, had already indicated. Medina did not give details, however, she assured that the purpose is to bring stability to the Portuguese through an “effective and solid solution for families.” For now, she guaranteed that the main objective is to stabilize the installments of those who have mortgage loans, for a certain period of time and bring peace of mind to the Portuguese. For the minister, the fundamental thing is to “create a situation of predictability and stability here.”
The Minister of Finance explained that for Portugal the new increase in interest rates is especially important, since the country has numerous mortgage loans at variable rates, which are unusual in Europe. The impact of rising interest rates on variable rate regimes is very rapid and “brutal” for families, he told reporters.
Medina also confirmed that the Government will work to expand the interest subsidy, giving priority to families with effort rates of 35 and 50%. In this way, the intention is to increase the number of families that can access the interest subsidy and reduce the real burden that real estate credit represents for the Portuguese.
The Minister of Finance assured that the Government has “worked very intensely” with the Bank of Portugal and the Portuguese Banking Association to mitigate the impacts of the new rise in interest rates on the lives of the Portuguese.
Source: Observadora
