Catalonia's union for small- and medium-sized companies, Pimec, got Montoro to do something that many companies and courts have not been able to do: the Finance Minister will sanction any company that does not follow Spain's mortgage default laws.
The government has decided to crack down on mortgage defaults in an effort to nix a problem that is threatening Spain's economic well-being. Behind Italy and Greece, the nation is the third-worst in Europe for mortgage defaults. Sixty-eight percent of all signed contracts are in violation of the mortgage laws, which say that public administrations have 30 days leeway and companies have 60 days to get behind on their payments to small businesses and service providers before the government forces them to close. Leading by example is critical, and the government is making a small step in the right direction with this latest measure.