THOUSANDS of unemployed home owners in the Balearics were yesterday thrown a lifeline by the Spanish government when the Prime Minister, Jose Luis Rodriguez Zapatero, announced that unemployed home owners could be entitled to a new 50 percent mortgage payment suspension programme.
The government estimates that half a million people in Spain will be entitled to the 24-month mortgage breaks which come into force from January 1, 2009.
Spanish unemployment has rocketed to 14-year high this year and the Balearic unions have warned that there could be as many as 11'000 people without work in the Balearics this Christmas as economic growth slows to a crawl dragging job creation down with it.
The move was welcomed by consumer and mortgage groups yesterday although some feared that the requisites are too limited.
Announcing the new initiative to ease the financial burden on the country's unemployed with mortgages, Zapatero explained that those with a mortgage of over 170'000 euros are not entitled to apply for the two-year break. He said that the cabinet considered the figure, which is slightly above the national average mortgage, to be fair and that, once the 24-month break is completed, should the claimant face continued financial problems and need further cash aid, arrangements will be on offer for the outstanding mortgage payments to be made over a period of ten years.