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Bankruptcy in Mexico


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I warned my neighbors who are young, in their 30's. Husband had a few good years in construction and along came Xmas and they wanted a TV, Tablets and Cel Phones. Were able to borrow 5000 from Elektra/Banco Azteca and payments went well for almost a year. This year income is minimal so food, rent and TV comes first.

The interest goes up so fast they say they owe nearly 20,000 now and no relief in site

Collectors at their door a few times a week

Most of the people here that borrow money with no intention of paying back move to another part of Mexico and disappear

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Unfortunately common tale. Elektra/Banco Azteca has a reputation for asking for poor peoples property/homes as collateral for consumer loans. Like big banks everywhere, the bank then later leverages their loans with bloated fees, penalties and high interest to manufacture legal ways of seizing (stealing) people's property.

Some Mexican banks operate similarly to US banks who issue student loans and then manipulatw the payments requested, to allow the banks to cause $25,000 of student borrowing to typically balloon to $75,000 balances owed through excessive fees and interest, even when the student makes all requested payments on time.

One twist off the Greek mess is the over $200 billion in Greek bonds that London, Frankfurt, and Paris banks scooped up to collect 10%, 12% and even 14% returns as interest paid out to bankers, taken from the rescue billions given to Greece since 2010. Now that the Greek government junk bonds are threatening default, big banks have put the screws to politicians to bail them out, again.

Moral? Mexican bankers, US bankers, European bankers look out for #1 (themselves), so the rest of us must personally protect our own interests and not rely on bankers "advice", regardless of what country we live in.

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