Spain's socialist government announced Friday it had extended a mortgage moratorium for out-of-work homeowners in a bid to stem foreclosures.
Jobless homeowners will now be able to defer up to half of their monthly mortgage payments up to a maximum of EUR500 for three years instead of the two years planned when the measure was unveiled in November.
Deputy Prime Minister Maria Teresa de la Vega said those benefiting from the scheme would have 15 years instead of 10 years to pay back the deferred amount once the initial three-year moratorium period had expired.
The government will underwrite the deferred payments.
The plan applies only to people with mortgages of EUR170,000 or less, which is just above the national average.
When Prime Minister Jose Luis Rodriguez Zapatero unveiled the measure in November he estimated that the mortgage moratorium could apply to up to 500,000 households.
The plan is part of a series of measures aimed at helping the Spanish economy deal with the fallout of the collapse of a real estate boom which has pushed the country to the brink of recession and driven up unemployment to the highest rate in the 27-nation European Union.
Spain's unemployment rate has risen each quarter since it dipped to 8% in the second quarter of 2007, its lowest level since 1978, to hit 14% during the last three months of 2008.
