SAO PAULO, June 1 (Reuters) - Payments in arrears for more than 90 days for Brazil’s “Minha Casa” lower middle-class mortgage program are up as much as 22 percent for the country’s poorest due to the deepening recession, newspaper Folha de S.Paulo said Monday.
Government-controlled lender Caixa Economica Federal disburses the bulk of mortgages in Brazil and the losses due to default from its loans will appear on its balance sheets. CEF is due to release results in the coming days.
The paper cited the Ministry of Cities as source of some of the information in the story.
Mortgage holders with income of up to 1,600 reais ($500) a month showed the greatest increase in defaults, the paper said. Their payments range from 25 reais to 80 reais a month for 10 years, which amounts to only about 5 percent of the average price of the homes being delivered.
The national Treasury covers the remaining balances on the units.
“People in the lower-income brackets are most at risk to changes in the economy,” Flavio Amary, acting head of the Secovi-SP housing association, said in the article,
Folha said default rates were much lower in higher-income brackets but also were on the rise.
Caixa Economic Federal was not available for comment on the story. (Reporting by Reese Ewing; Editing by Lisa Von Ahn)