Mexico’s Infonavit slashes student loan backlog by half with bold reforms
Mexico’s Infonavit has made significant strides in tackling its backlog of student loans. When the current administration assumed office, 4.856 million borrowers grappled with unaffordable mortgages. Now, over half of these cases have been restructured, with a deadline set to resolve the rest by December 2023.
The changes coincide with new policies aimed at making housing more accessible for young workers. These reforms target past issues, including unaffordable loan terms that left many in financial distress.
Before President López Obrador’s term, Infonavit loans were widely criticized for overcharging borrowers. Many found repayments unmanageable due to high interest and fees. The administration stepped in to restructure these debts, converting 2.5 million of the 4.856 million problematic student loans into more manageable plans.
At the same time, the institute has expanded access to housing. Young workers now qualify for mortgages after just six months of contributions, a significant reduction from previous requirements. Some have already received keys to their new homes under the updated rules.
Octavio Romero, Infonavit’s director-general, confirmed that the remaining non-performing student loans will be settled by the end of 2023. This move will clear the institute’s entire backlog of troubled mortgages. When the current team took charge, Infonavit managed 6.563 million active student loans, many of which were at risk of default.
The restructuring effort has centered on lowering payments and adjusting terms. Borrowers who once faced insurmountable debts now have realistic repayment schedules. The institute has not announced similar large-scale resolutions beyond this December’s target.
By the close of 2023, Infonavit will have resolved all 4.856 million non-performing student loans inherited at the start of this administration. The changes also include faster access to housing for new contributors. These measures address years of unaffordable loan conditions, which the government has worked to rectify through restructuring and policy updates.
