Icelandic Supreme Court rules foreign currency loans illegal

The Rejkjavik GrapeVine (via CalculatedRisk):
The Supreme Court of Iceland ruled [...] that car loans pinned to foreign currency [...] were in fact illegal.

Two cases were connected to the ruling involving car loans taken from the companies Lýsingu hf. and SP-fjármögnun that were pinned to foreign currency. With the collapse of the Icelandic crown in 2008, many people who took out such loans - at a time when the crown was strong - saw their debts double almost overnight.
Gísli believes the next step will be to examine real estate loans that were structured similarly. In the meantime, he says, "Consumers have been acquitted."
Let's hope that the same ruling will happen very soon for mortgages.

This post is dedicated to Jeff, who's been a great passive supporter of the Icelandic people against the state and the banks.


Dave Narby said...

This is great news.

If Iceland can get itself out from under the boot of the bankers and recover, then there will be many more following suit.

pej said...

Yes, Go Iceland, Go!
Not sure whether Jeff you're receiving my replies to your emails?