Daily Israel Report

Prior to War, Banks Began to Refuse Yesha Mortgages

Prior to the Re-Engagement War in Lebanon and Gaza, banks began refusing mortgages to people wishing to build in Judea and Samaria (Yesha) due to PM Olmert’s Convergence Plan.
By Arutz Sheva Staff
First Publish: 9/4/2006, 1:52 PM / Last Update: 9/3/2006, 6:35 PM

Following a recent Arutz-7 report on the matter, and now that Prime Minister Ehud Olmert has reportedly shelved his Convergence Plan, the Finance Ministry has stated that none of its directives had changed, and that any refusal to grant mortgages was the decision of the banks alone.

The original report, which appeared on Arutz-7’s Hebrew news site, related the story of Moti Makovich, a teacher from the Samaria community of Kedumim, who applied for a loan from several banks two months ago when seeking to expand his home. He was refused on the grounds that, “from Prime Minister Olmert’s statements regarding his Convergence Plan, it was not worthwhile for them to risk their bank’s money,” Markovich explained.

The only bank that agreed to provide the loan was Bank Adanim – and even they agreed to provide just 30-35% of the sum, saying that even that was “above and beyond the law.”

A member of the town of Elkana’s munipality, Tzachi Fenton, sent a letter to the National Union-National Religious Party, asking its Knesset members to submit an emergency request that the matter be brought to the parliamentary agenda. “We are talking about a step that presents the actualization of the beginning of the destruction of the settlement enterprise, without a decision by the government and without authorization from the Knesset,” Fenton wrote.

Fenton added that the way in which the events were unfolding had all the earmarks of the “manufacturers of the Disengagement and Convergence – in their malicious attempt to dry out settlement in Judea and Samaria.”

MK Zevulun Orlev brought the matter up with Minister of Housing Meir Sheetrit, asking him to act on behalf of the continued granting of mortgages toward building in Judea and Samaria. Sheetrit, who is now also Acting Justice Minister, replied that the directives from government ministries had not changed, but explained that certain types of mortgages were the responsibility of individual banks – who had the right to refuse to grant them under risky circumstances.

Immediately prior to the implementation of Prime Minister Ariel Sharon’s Disengagement Plan, residents of Gaza found themselves refused loans by banks. Ironically, after the forced eviction and demolition of their homes, residents were required to continue to pay the mortgages for their nonexistent domiciles – mortgages that had been approved when Sharon, as a Likud government minister, encouraged Jewish settlement in the region.

It remains to be seen whether banks will hesitate to grant mortgages to building projects in communities located on the "other" side of the Partition Wall, as it nears completion.