Spain Lets Jobless Postpone Half of Mortgage Payments

Nov. 3 (Bloomberg) -- Spain will allow unemployed workers to put off paying half their monthly mortgage payments for two years, Prime Minister Jose Luis Rodriguez Zapatero said today, part of a series of measures aimed at softening the impact of a shrinking economy.

The postponed payments, up to a maximum of 500 euros ($640) a month, will be repaid from January 2011 in installments, Zapatero told a news conference in Madrid today. The measure, which applies to mortgages under 170,000 euros ($218,000), could be used by more than 500,000 people, he said.

While the government will guarantee the payments due from 2011, the banks will bear the cost of the two-year postponement, said a spokeswoman at the Finance Ministry, who declined to be identified in line with policy.