The real estate market went through a favorable phase that made many Brazilians take advantage of the momentum to realize the dream of owning their own property. But for many this endeavor has become a nightmare. Data from the Central Bank (BC) prove this.

Evidently, the first option to avoid losing the property is to try to reach an agreement to renegotiate your contracts with the banks. This is an urgent matter, because after the third late payment, the borrower runs the risk of having his property auctioned. Therefore, as soon as you feel difficulty in paying the installments, it is important to seek immediate renegotiation.

And even worse things can happen. When the property goes to auction, besides losing the property and being included in the defaulters’ list for five years, all the costs involved in the execution and the auctioneer’s payment are deducted from the borrower.

To avoid this huge headache (and financial and emotional damage), we have elaborated some possible solutions for those who have debts on housing loans.

  • Overdue installments – Contact the bank and try to reach a payment agreement. The bank is not obligated to accept the proposal, but the chances of renegotiating the financing increase;
  • Ask for a pause in the payment – Every twelve months of financing it is possible to ask for a pause of one month for the next payment. The value of that unpaid installment is divided among the following installments;
  • Request a Revision Action – This is a judicial request for a revision of the contractual clauses of the bank financing contract, which may contain abusive interest rates, errors in the installment amounts, and other irregularities;
  • Go to the bank – With the financial crisis, the financial institutions are more flexible in negotiating overdue installments. It is possible to obtain a grace period for payment, incorporate the debt into the installments to be paid, and even recalculate the balance due. The simple negotiation can remove the debtor’s name from the registry of defaulters. Take with you the contract and documents that prove your financial difficulty, as well as your CPF and ID. But be careful, because the renegotiation contract may contain abusive clauses;
  • Ask for an interest reduction – Many institutions are holding joint efforts to negotiate debts and can lower the interest rates during the negotiation. If you pay the debt in cash, demand a bigger discount;
  • Take advantage of the fall in the Selic rate – The basic interest rate, which guides the credit system, has been lowered by the Central Bank in recent months. Borrowers, either delinquent or even those who are up to date with their payments, can take advantage of the Selic’s fall to ask for a lower interest rate on their debt, corresponding to the current level, exchanging an expensive loan for a cheaper one;
  • Renegotiate the financing term – Request an increase in the financing term for the property, without increasing the interest rate. The value of the installments decreases and you can rebalance your finances. But beware: there is a limit to the number of installments and the final term cannot exceed the borrower’s 80th birthday;
  • Change your bank – This right is ensured by the Housing Credit Portability Law, approved in May 2014. You can transfer your balance to another institution with lower rates, without increasing the term or changing the amount financed. Beforehand, make a simulation in the destination bank, because with the notarial costs, portability may not be advantageous;
  • Go to Court – An amicable agreement is preferable to a judicial one, but if your attempt to negotiate with the bank is unsuccessful, seek your rights through the Judiciary. In court, it is possible to release the FGTS to pay the installments in arrears and prevent the property from being repossessed by the bank and auctioned;
  • Use the FGTS – You can use the FGTS to pay 80% of up to 12 installments of the financing, but only three of them can be overdue. Or you can amortize the outstanding balance. This resource can only be used after two years, if you have used the FGTS to make a down payment on the property;
  • Renting the property – To get rid of the debt and decrease the monthly costs, it is even worth renting the property and using the rent payment to pay the installments with the bank;
  • Selling the property – This is a profitable strategy: with the money from the sale of the property, you can buy a new, cheaper property. Deduct the debts from the value of the property and use the remaining money to reestablish yourself;
  • Transfer your mortgage – As a last resort, you can transfer your mortgage to another person and receive a share in cash. Still, the transfer must be authorized by the bank;


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