Anger over mortgages

SANTIAGO — They’ve spent the night atop a 25-meter-high construction crane. They’ve blocked highways, barged into solemn events and climbed the windows of the presidential palace. And as of early this month, dozens of people with mortgage debts were camping along the edge of a city river, pledging not to end their protest until the government takes care of decades worth of old debts they can no longer afford.

These debtors — who are low-income — have organized a group called Andha-Chile. Their current protest has them setting up tents steps from the polluted Mapocho River that crosses the capital. They’ve weathered cold, damp nights, recent rains and a lack of hygiene.

Specifically, they want the government to cancel the debts of the most vulnerable of the 195,000 debtors who signed up for a 20-year-old housing program.

President Michelle Bachelet tries to keep as far away from the group’s members as possible. She knows that wherever she goes, Andha is sure to follow, and they are not a quiet bunch. The police have had to draw up special security plans when there is a chance that Andha-Chile members may appear.

The group’s 14,000 members have intensified their protests in recent months, resorting to occasionally dangerous ways of drawing attention to their cause. They say that with interest rates as high as 14 percent, and with the economic climate deteriorating, they are simply unable to continue their payments. They are afraid that their homes will be taken away, something the government has promised to prevent.

They have disrupted solemn events, interrupted Bachelet’s speeches and staged loud protests outside her home. They have barged into the Sheraton Hotel during the finance minister’s speech to business leaders, and have protested in front of his home.

They’ve demonstrated outside and inside government offices and banks, set up barricades on city streets and highways, and occupied a cathedral south of the capital. They’ve marched 75 miles to Congress, hung from the electronic voting panel inside congressional chambers, climbed up the presidential palace windows and waddled in its water fountain.

Members of the group say that they’ve paid enough.

“We’ve paid the value of our homes several times over," said Benedicto Cuello, a member of the organization. "Mortgage payments were established in U.F. (a measurement unit based on inflation that is adjusted daily), and rise constantly. These are poor quality housing units that are worth very little, and we should be made to pay for what they are worth, not what the banks want to profit from them."

Cuello has been paying off his mortgage for 18 years now, and is now 30 payments behind. He has nine years left to go to pay for his 52-square-meter house, which he bought when it had an unfinished electric system, no doorknobs, no separations between bedrooms and a cement floor.

The Special Program for Workers (PET, in Spanish) Cuello applied to was set up in 1985 and, according to the Housing Ministry, was aimed to help middle-income families. It consisted of three-part financing: family savings, a government subsidy and a bank loan.

Today, the ministry says that the issue of these mortgages is a private matter involving the debtors and banks. “These families have known from the very beginning what the conditions were," said Juan Pino, head of the mortgage portfolio unit of the Housing Ministry. "The Housing Ministry did not provide these loans — this was a contract between the debtor and a financial institution."

But Ivan Carrasco, national leader of Andha-Chile, disagrees. “This is not a problem between citizens and private banks. This is a result of government housing policies implemented in the past," he said.

The government has written off the remaining debts of some low-income mortgage holders who were part of state programs. Two years ago, Bachelet announced the cancellation of subsidies for the remaining debt of about 93,000 state-subsidized homeowners.

And while the government says it isn’t responsible for homeowners like Cuello, who were in the PET program, it has tried to assist them. In 2007, Bachelet said that the government would help them renegotiate their debts at current market interest rates.

This year, she promised that the government would study the cases of the most vulnerable families, and she recently offered to subsidize 50 percent of the mortgage payments of those most in need.

For Andha and other similar orgnizations, the government’s efforts don’t suffice. They say the proposals would benefit few, and that the renegotiated debts would drag on. Moreover, they say, if a family fails to pay for three consecutive months, the house would be automatically auctioned off.

Andha member Gloria Pomer is way behind in her payments due to her husband’s long periods of unemployment. “In my neighborhood committee of 100 families, there are people with catastrophic illnesses, or who can barely live off their pensions. I have a 70-year-old neighbor who receives a monthly pension of $90, but her mortgage is $120. She asks me: ‘What should I do, pay mortgage or eat?’ She prefers to eat,” Pomer said.

Pomer, a 50-year-old housewife, has participated in Andha for four years. She is now camping out by the river. Her participation in the group has prompted problems with her family at home. “But we have to get out on the streets,” she said. “It’s the only way the government will listen.”

Pomer has lost track of how many times she’s been arrested. Now, she and her fellow Andha members are threatening to bar all candidates up for election in December from their neighborhoods until their demands are met. And they mean it.

More GlobalPost dispatches on Chile:

History gets a rewrite at the Pinochet Museum

Is Chile heading to the right?

Santiago struggles to deal with its smog woes

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