INSIGHT-In Spain, banks buck calls for mortgage law reform
News from Reuters:

MADRID | Tue Feb 26, 2013 5:00am EST

MADRID Feb 26 (Reuters) – For more than a century, Spanish law has determined that if a person borrows money to buy a home, they can only be freed of the debt when it is repaid. Even in death, the debt is not cancelled. As the country enters another year of recession, calls are mounting for the system to be relaxed. But the banks worry this would damage their access to funds.

Take Francisco Lema, an unemployed 36-year-old builder, who dropped off his 8-year-old daughter at school on Feb. 8 and returned to the family’s rented fourth-floor flat in the Andalusian city of Cordoba.

The house he built himself had been repossessed, leaving a debt of 22,000 euros ($ 29,000) on the mortgage he took out to cover building materials, said family friend Maria Jose Vadillo, an activist for Stop Evictions Cordoba, a pressure group. His parents had stood guarantor for part of the loan. Now he was struggling with the repayments, said Rafael Blazquez, another activist with the same group.

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TransUnion: Late Auto-Loan Payments Rose in 4Q
News from ABC News:

More Americans fell behind on their auto loan payments in the last three months of 2012, a time of the year when some borrowers’ financial obligations temporarily take a backseat to spending on holiday shopping.

Beyond the seasonal increase, the late-payment rate on auto loans declined on an annual basis and remained near the lowest point in more than a decade, credit reporting agency TransUnion said Tuesday.

The trend comes amid a strong market for cars and trucks. Many Americans are moving to replace older vehicles after holding back on purchases for several years following the last recession.

U.S. auto sales grew 13.4 percent last year to 14.5 million and are projected to climb up to 15.5 million this year.

The combination of strong auto sales and low interest rates has fueled a rise auto financing. As more borrowers have taken on auto loans, the ratio of those who have failed to make timely payments has diminished.

In addition, most borrowers continue to make paying their auto loans a priority, a trend that grew more pronounced in the aftermath of the housing collapse and recession.

“Consumers are valuing their auto-related loans a little more ahead of other things when they do get a little bit stretched in their budgets,” said Peter Turek, automotive vice president in TransUnion’s financial services busin…………… continues on ABC News

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