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Mexican mortgage lender Infonavit to probe alleged illegal foreclosures

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Mexican mortgage lender Infonavit to probe alleged illegal foreclosures

Mexican state mortgage lender Instituto del Fondo Nacional de la Vivienda para los Trabajadores has launched an internal audit into the alleged illegal foreclosures that has rendered some of its borrowers homeless, the entity's new director, Carlos Martínez Velázquez, told El Economista.

The head of the Mexico-based institution also suspended the auction processes, which reinserted the properties back into the housing market.

The alleged unlawful cases gained traction in December 2018 when judges from the states of Nayarit and Coahuila were reportedly suspended on accusations of involvement in the fraudulent procedures. Under the scheme, working-class borrowers would be sued without formal notification and judged unfit to pay their debts, thereby rendering their properties foreclosed. Former officials at Infonavit have also been probed.

Official records reportedly show 20,687 homes were reinserted in the market in 2018, which generated 2.70 billion Mexican pesos in income for Infonavit.

Should the audit find irregularities, the institution could potentially see legal actions from the victims. As of September 2018, Infonavit had reportedly provisioned roughly 303 million pesos due to 87,241 open lawsuits.

As of Jan. 11, US$1 was equivalent to 19.13 Mexican pesos.