Caixa Announces Six Months’ Grace Period, Further Crisis Measures

RIO DE JANEIRO, BRAZIL – The Caixa Econômica Federal (Federal Savings Bank) announced on Thursday, April 9th, that it will provide a six-month grace period for new housing loans, both for individuals and corporations.

The initiative is part of a package of new measures focused particularly on home loans in an attempt to fight the economic impact of the Coronavirus pandemic.

Pedro Guimarães, president of Caixa, estimated that these six months of grace for individuals and companies should help preserve the jobs of 1.2 million building workers, and left a message for companies in the sector.

“We have a commitment with the building companies, but we will not accept layoffs, we want protection for the employees. If employees face difficulties or there are layoffs these rules will not apply to the company,” he said in a press conference yesterday morning.

The Caixa also reported that it has allocated R$43 billion (US$8.6 billion) to housing credit programs, in addition to the R$111 billion earlier announced for new credit lines.

“This has never happened and the Caixa demonstrates alignment with the crisis that the country is facing. Part of our customer base is made up of low-income people, so all the measures we are announcing are valid for all customers in all income lines including corporate entities”.

“Our concern is with job maintenance, loans, and the housing program. This is a total of R$154 billion to help Brazilians. We will maintain balance at this time,” the president said.

Guimarães also made it clear that the bank will extend deadlines and relax measures if the crisis is prolonged. “The Caixa will act and react to the crisis. If the situation worsens, we could extend the credit lines to ensure aid to all,” he said.

Check the measures announced in the scope of housing loans:

Natural persons

For individuals, the Caixa has made available a number of options:

a) The main measure is a 180-day grace period for those who wish to purchase new properties. “The initiative applies to any Caixa customer, whether it is ‘Minha Casa Minha Vida’ (My Home My Life) or ‘média renda’ (Average Income). We are allowing Brazilians to make their dream of owning their own home come true”, says Jair Luiz Mahl, vice president of Housing at Caixa.

b) People can request a break of up to 90 days of credit contracts payment: this is valid for any real estate credit line of the bank and for all customers. “From customers of Minha Casa Minha Vida to middle-income customers, everyone is covered”, says Mahl.

If customers do not wish to suspend their corresponding installment payments, as of Monday, April 13th, the Caixa also announced that it will be possible to arrange partial payment of installments.

“In this case, customers need to reach Caixa by phone and state their option and the amount of the payment,” he says. Caixa phone number: 0800 726 0101.

c) Clients who are building their own house individually will be inspected with digital models. “We will conduct non-physical inspections to protect employees and customers,” says Mahl.

d) Defaulters of real estate credit contracts who have been unable to pay their installments for over 61 days as of Monday, April 9th, will have access to payment breaks for up to 90 days.

“These clients will be contacted or may contact Caixa to request this temporary service. Our clear goal is to keep Caixa’s contracts active while getting through this period. That is why we want to provide conditions for customers, even those with overdue payments,” says the vice president.

All other measures come into force as of Monday, April 13th.

Companies

The measures announced for legal entities apply to small, medium and large-sized building companies.

a) A grace period of 180 days to start works and to start repaying the debt of completed works. “We know that entrepreneurs’ investment to start building is high and we want to help them stick to their schedule”, says Mahl.

b) Advancing of the legal entity financing in an amount equivalent to up to three months of the building schedule to be executed. “The construction company can request the advance of this amount and we will assist through these R$43 billion loans that will be available. This generates liquidity for the building company and a greater cash flow at this difficult time,” says Mahl.

c) release of resources from unused previous funding. “Building companies that already had a contract with Caixa and had not used the financing fund for any reason may apply starting Monday,” says the vice president.

d) Extension of the physical and financial schedule of works. “The company is free to reschedule, reconfigure the works without prejudice and at no additional cost,” says Mahl.

e) Partial payment of charges over 90 days. “As with individuals, if companies do not wish to suspend payments in full, they may choose to continue paying a portion of installments. They should also get in touch with Caixa”, says the executive.

f) Anticipation of up to 20 percent of financing in new ventures.

“We want to provide reassurance to companies and building employees, keeping the sector relevant to the Brazilian GDP and active, and providing conditions for construction companies to continue operating,” says the vice president of the bank’s Housing sector.

Source: InfoMoney