Report: Blackstone To Reduce Debt on $7.2B Worth of Spanish Mortgages
Blackstone Group reportedly plans to slash homeowner debt on $7.2B worth of Spanish home loans. Sources tell Bloomberg that the private equity giant, which holds roughly 40K Spanish mortgages, will relieve the repayment burdens of some borrowers and forgive others entirely in exchange for the keys. The move comes amid a growing political movement to ban evictions in the country, where about 20% of borrowers are underwater. Homes in Spain have lost 42% of their value since peaking eight years ago.
Blackstone last summer bought 6.4B euros of mortgages from the floundering CatlunyaCaixa for 3.6 B euros. The debt relief program would spare the firm a trip through the long, pricy maze of repossession and assuage fears that investors are in a land grab for the homes of struggling owners. [Bloomberg]