‘The new bills should have no mercy on the banks’

Deputy minister of works and transport Veikko Nekundi said the new proposed bills tabled in parliament on the issue of immovable properties used by people as primary homes should have no mercy on the banks.

He was speaking in the National Assembly yesterday.

“Banks have been treating people without mercy, they are heartless and are happy to gain at the expense of ordinary Namibians, as they chase them into a roofless environment, therefore, the new proposed bills should also not have mercy on them.”

Nekundi said the bills should not be a mere formality, but must be meaningful for those who have suffered at the hands of banks.

“The banks, whose profits are protected by laws, are making billions, but they do not even plough back into society, yet they are profiting from the very same people that they are making to suffer,” said Nekundi.

The proposed bills were tabled in September by justice minister Yvonne Dausab, aiming to make it harder for banks to repossess the homes of defaulting clients.

Nekundi said certain adjustments should, however, be made to the proposed bills for property to be sold at a reserved price at market value, and must apply to all immovable properties, whether they are residential or not.

“There had been reported cases where residential and business properties worth millions were sold unjustifiably and lower than the market prices.”

Nekundi also criticised the bill’s definition of primary owner, and said due to the economic situation in the country many people are forced to have more than one place as a primary home.

“Many people, due to the structure of the economy, have been forced to move from villages to towns for better opportunities and, therefore, have more than one residence. This may bring disputes as on the definition, there I propose that primary home include at least two or more residential areas, depending on the circumstances.”

Two amendment bills, one to the Magistrate’s Court Act and another to the High Court Act, allow home loan holders to sell their own homes instead of being repossessed, in the case of payment defaults.

The bills introduce safeguards to protect individuals who use their immovable property as their primary home, from losing it through foreclosure due to financial difficulties.

These regulations include setting a reserve price for the sale of the property based on its market value and ensuring that the highest bid cannot fall below this threshold.

However, these changes do not solely focus on property sales but also provide alternatives. In cases where selling the primary residence is not deemed appropriate, the court may consider various alternatives, such as attaching other property owned by the debtor or adjusting repayment terms.

According to the bills, banks may need to navigate additional legal procedures and requirements when seeking to sell immovable property through execution. These procedures include the need for a court order authorising the sale and demonstrating that the sale is the most appropriate way to satisfy the judgement debt.

If the court determines that the sale of the primary home is not appropriate, it can consider alternative options.

Rule 108 of the High Court rules currently allow for judicial oversight in matters of bank repossessions.

Speaking to The Namibian in May, Bankers Association of Namibia chief executive Brian Katjaerua emphasised that banks are currently adhering to rule 108.

He said each case is being handled individually and underscored the significance of clients fulfilling their loan obligations to prevent banks from facing insolvency.

“If everyone owes the banks money and none of them pay, how will the banks survive?”

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