What do the banks’ think about Expropriation Bill?

 

South Africa: #CitizenAbuse – What do the banks’ think about Expropriation Bill?

Both the government and South Africa’s financial institutions must make clear their positions regarding the mortgage bonds on properties that may be expropriated under the terms set out in the Expropriation Bill.

This is the view of the Institute of Race Relations.

With all indications being that the Expropriation Bill will be passed, its practical implications need to be spelt out. The Bill makes provision for the expropriation of property at ‘nil’ compensation in various circumstances, and the probability of compensation being significantly below market value in most others.

Bonds to purchase property are a major financial obligation for countless South African households – an arduous one that is taken in the expectation of accumulating assets and building financial security. 

In instances where bonded properties are taken, what responsibilities will be imposed on the dispossessed bondholders? The Bill suggests that bonds will be terminated, but does this imply that outstanding debts will be cancelled? Or is the expectation that bondholders will need to continue servicing their bonds until they are paid off, even if the asset has been taken?

What position do banks take? In the event of a seizure of a client’s property, will they require payments to continue?

These are seminally important questions for millions of South Africans. Will their government and the financial institutions in whom they have trusted respect or disregard their interests? This is no longer a conceptual issue, but is poised to become a very real avenue for the abuse of South Africa’s people.

The Institute of Race Relations will be pressing both the government and financial institutions to spell out their positions clearly and unambiguously on this.

The Institute of Race Relations is a 91-year-old South African civil society body and think tank promoting freedom and working against #CitizenAbuse.

https://dailyfriend.co.za/2021/03/29/citizenabuse-what-do-the-banks-think-about-expropriation-bill/