Latvian banks are holding real estate seized from borrowers

Most of the real estate excluded from borrowers who have taken a mortgage loan, the banks are holding, waiting for prices on the real estate market. About this newspaper Latvijas AvD «ze. Sell ??real estate now is unprofitable because of the lack of recovery in the market. As acknowledged by experts interviewed by the publication of the proposal for the sale of apartments, private houses and plots of land far exceeds the demand, and the number of deals in the market is very small. Banks say that the disposal of subsidiaries set up to purchase "troubled" properties, gets only a small fraction of objects that are selected from borrowers, not coped with the repayment of the loan. Representatives of banks complain that the special auctions, which sold off the property of debtors, are disadvantageous for two reasons. Firstly, the starting price of auctioned objects are usually 30-40% below its market value. Second, to conduct similar auctions harms the reputation of banks, especially in cases where the auctioneer is the sole property of the borrower's housing problem. According to representatives of banks, such borrowers are usually trying to resort to other solutions, not related to the auction. One option is as follows: The bank takes the apartment itself, and its former owners still live there, pay the bank to pay rent and utility bills. Source: rus.DELFI.lv