Don't use land certificates as collateral

Don't use land certificates as collateral

JAKARTA (JP): The government is appealing to land owners,
particularly rice farmers, not to use their land certificates as
collateral for bank loans because they could lose their most
treasured possession.

"Think twice before you offer the land certificates as
collateral. If you cannot repay the loan one day, the bank will
auction your land and you lose possession," State Minister of
Agrarian Affairs Soni Harsono was quoted as saying.

Soni said the government is particularly concerned that more
and more people, farmers in particular, are mortgaging their land
against loans, putting their livelihood at great risk, the Antara
news agency reported in a dispatch from Surakarta in Central
Java.

His comment came as more and more farmers are defaulting on
their loans. There could be more problems on the way as many
farmers in Java are reporting major crop failures because of the
severe dry spell.

Soni also announced that the government is relaunching its
program to issue land certificates en masse for farmers who are
entitled to obtain them after tilling their plots for a long
time. (emb)