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Palestinians Are Up to Ears in Debt
(Los Angeles Times) Edmund Sanders - In recent years, the increased availability of mortgages and consumer loans has caused personal debt to balloon in the Palestinian territories. It more than doubled, to about $750 million, from 2008 to the end of 2011 and rose 40% over the last year alone, according to figures from the Palestinian Authority. Most of the increase came from a surge in home loans, which were once available only to the rich. Last year, the PA, with U.S. help, launched a $500-million mortgage-guarantee program in the West Bank. First-time homeowner Muhannad Qaraden, 40, said he obtained a mortgage with just a 15% down payment and no cosigners. "You can look around and see the impact of credit on the streets," said Basim Makhool, head of the economic consulting firm Creative Business Solutions. "All the cars are new. There's so much construction." The West Bank economy is heavily reliant on international donations and tax transfers from Israel, experts said. Yet foreclosures and evictions are virtually nonexistent in the West Bank because cultural pressure makes it difficult for lenders to repossess property in the close-knit Palestinian society.