Hypothets in Kosovo not buying them

All these are mortgages, which commercial banks in the Kosovo market have put up for sale. The sale of mortgages is due to the credit write-off failure by creditors. But, in the Kosovo market, it rarely happens to be bought off property left hostage in banks.

Hypothetec is a real right placed on debtor's wealth in behalf of the creditor to ensure the fulfillment of an obligation.

According to Central Bank data from the Republic of Kosovo, around 4.8m euros is the total value of all real and active assets in commercial banks in the country.

Experts on financial and accounting issues in Kosovo consider that the problem of not leaving mortgage property has to do with the tradition of citizens not buying wealth, according to them, with problems.

Master Fadil Hoxha, formerly deputy chairman of the Executive Board of Private Masters, tells Radio Free Europe that citizens are reluctant to buy the properties left on mortgages.

He shows that interest in these properties is not missing, but there is no purchase.

“There have been several times of interest, actually citizens have come to be interested in the price of these properties, they haven't discussed whether they have problems, despite the fact that we show them that there are no legal problems, because the law exists for such a matter, but then it hasn't been presented”, Hoxha says.

Even financial experts stress that buying mortgages from third parties in most cases fails because of citizens' tradition.

Hashim Rexhepi, a former governor at the Central Bank of the Republic of Kosovo, says that despite the fact that the banking system in Kosovo is stable and non-aligned loans are at a low level, non-recognition of mortgage property is a very complex and extremely complex problem.

In cases where banks are forced to sell various properties, the mentality from the past is still present, so that their relatives' properties are not bought. This requires greater awareness because property is property and it is the bank's right to sell. I think this issue will gradually advance and solve as a problem. But, in the absence of potential buyers, these properties are mostly forced to buy commercial banks themselves. Usually in 99 percent of cases, banks buy and become owners of them”.

However, according to civil society dealing with this issue, financial institutions operating in the country greatly depreciate the value of real estate left as mortgage or collateral in commercial banks.

Otherwise, the value of loans issued by 10 commercial banks has reached around 2. 6 billion euros, at a rate of 6.5 percent.