– Manager, Cooperative Lar do
Patriota (CLP)
The Cooperative Lar do Patriota is funded by the contributions from its members, and when it comes to housing, the cooperative is trying to build low-income homes instead of homes for the middle-income earners. This is to give access to affordable housing to people who do not have the purchasing power of the middle class. Our members have an income, but their salary is not enough to acquire homes designed for the middle-income earner.
The Cooperative Lar do Patriota has problems that similar organizations face — initially when the housing project started, it was considered one of the first housing projects in the country and the members considered it a good idea. Members are required to make a downpayment equivalent to 20% of the value of the house being constructed, and then continue to make monthly payments. What happened was that when the houses were turned over to the prospective owners, and after they have moved in to their homes, some members automatically ceased to make their monthly payments. This is completely contrary to the cooperative principles – as a mutual association, the members are expected to continue to contribute until the end of the project.
The situation is complicated because there are no legal mechanisms to deal with the person who does not agree today to continue to make the payments as agreed in the beginning. In the absence of these legal mechanisms, the cooperative has no way to repossess the house from the individual who considers himself the rightful owner, after having paid 30% or 40% of the value of the house.
There are serious repercussions – for instance, there are other members of the cooperative who have paid the down payments and are waiting for a house to be turned over to them. What will stop them from doing the same?Understandably, the banks are also reluctant to finance such projects, and the
cooperative is placed in a difficult situation because there is no legal recourse.
Within a legal system that works, contracts are signed, rules are set, and the parties who are in default will be sanctioned and made to fulfill their obligations.
We have a population without the financial ability to afford a house that costs US$ 60,000 to US$ 70,000 dollars. Without a legal system that enforces contracts, and without adequate loan collaterals that reduce the risk to the banks, it is extremely difficult to continue this type of project. The state should create conditions that will facilitate all transactions so that the
banks could recover funds loaned plus interest, the cooperatives