Russians default on their mortgages

Credit: Nina Zotina | RIAN

Some Russians have stopped making regular payments on their mortgages. As a result, the amount of overdue mortgage payments now exceeds RUR 72 bln ($1.1 bln), the Dolgovoi Konsultant (Debt Consultant) collection agency reports.

According to experts, some Russian mortgage borrowers may lose their apartments over non-payments, writes. Banks have been authorized to seize debtors’ property starting in 2020.

The number of overdue mortgage payments fell by 0.4% at the beginning of this year compared to the last; yet, officially, there are about 22K ‘problem’ apartments in Russia. Moreover, their actual number is 50% higher if sold mortgages are taken into account.

Mortgages that were issued one or two years ago are most often found to be ‘bad.’ Demand for such loans surged during that period, and defaults began as well. Many Russians then used mortgages not only to purchase housing where they would live, but also for renting it out.

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