Puerto Rico Gov Enacts Voluntary Moratory Law
Bank Customers May Request Delaying Loan Payments Through June
SAN JUAN – Puerto Rico Gov. Wanda Vázquez Garced enacted a measure authored by Sen. Miguel Romero that orders banking and financial institutions on the island, including cooperatives, to offer their customers a moratorium on the payment of personal loans, car loans, mortgage loans and credit cards from March through June.
The measure to address what the governor called the coronavirus pandemic’s “direct and considerable impact on the economy,” prohibits the collection of surcharges or penalties or raising interest rates on customers who request the moratorium.
The moratorium will apply to customers who notify their financial institution that their situation has been directly affected by the enactment of Executive Order OE-2020-023, which established a curfew on the island.
“We have made this determination in protection of the well-being of all citizens because we understand it is urgent and necessary to continue taking measures aimed at protecting those people who have been seriously affected economically by the rigorous measures that were necessary to implement in response to the pandemic which we face as humanity,” the governor said in a press release issued by her office, La Fortaleza.
Joint Resolution 26-2020 establishes that customers are entitled to either pay their loans regularly or postpone their payments.
“Given the circumstances Puerto Rico is going through, we want to safeguard the economic security of hundreds of thousands of Puerto Rican families. The voluntary nature of this measure allows people who wish to continue making their payments as usual, to do so,” the governors said.
However, that person who is in a precarious economic situation as a result of the measures implemented in the face of this emergency may avail themself of the moratorium so as to have the resources to address their and their [loved ones’] basic needs without facing charges, penalties or an increase in interest rate or additional interest that makes their financial condition more vulnerable. But it is important that they notify it,” Vázquez added.
People who meet the eligibility requirements, may take advantage of the moratorium at any time during the four-month period and then may voluntarily decide to resume their payments as usual without surcharge or penalty, the release says.
“In addition, it is important to point out that, when availing [oneself of the] moratorium, the term of maturity of the debt concerned will be understood as extended for an equal number of terms to those not [paid]. The debtor or client may choose, by means of a written authorization, that the total payment of the months to which the moratorium is accepted be deferred between the remaining terms of the loan,” the release reads.
In the case of mortgage loans, “creditors will offer the option to the client or debtor who avails himself of the moratorium on making the payment for the reserve account, in cases that apply, and they will advise about the effects that non-compliance could cause. Any mortgage modification granted by a financial creditor, whether or not it is a Federal Entity, or its agent to assist a client or debtor to address the impact of the emergency, will be automatically formalized, as will the mortgage debt, the deed and any other evidence of the debt will be automatically amended so that it reflects the extension by the term of the moratorium granted by the financial creditor,” the release added.