Turkey’s state-run banks restructure mortgage debt at lower cost

Turkey’s three largest state-run banks offered to restructure mortgage loans at lower rates of interest, local media reported on Monday, as the government sought to revive the country’s crisis-hit housing market.

Ziraat Bank, Halkbank and Vakifbank expanded a reduction in interest rates to 0.99 percent monthly, below the current inflation rate of an annual 15 percent, to existing as well as new mortgage clients, the state-run Anadolu news agency reported on Monday.

The institutions made the offer to all clients with mortgage debt of less than 500,000 liras ($89,000). But those with loans exceeding that amount will also have the opportunity to restructure them, Anadolu said, citing a decision by the banks.

House prices in Turkey averaged 285,852 liras at the end of last year, according to sector news provider emlakkulisi.com

Turkey’s government has been making use of the three banks to help drive down interest rates and spur economic growth. The Turkish real estate market is among the worst affected by a currency crisis that erupted last year.

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