Private debt: 632,998 loans were settled

LAST UPDATE: 13:00

By Tasos Dasopoulos

Settlement proposals for 137 borrowers were completed by the end of February through the new bankruptcy code which is increasing its effect at a slow pace since the platform for out-of-court debt settlement has been visited by 48,897 people with unregulated debts.

Under the new framework, the settlement proposals are automatically generated using an algorithm, which takes into account the value of the property and disposable income of both the debtor and his co-borrowers – guarantors. In order to proceed, they must be accepted by those interested. The delay in submitting more applications according to the Ministry of Finance is mainly due to the prerequisite for the lifting of banking secrecy for all those involved.

Typical examples of successful settlement proposals that have been sent to debtors for acceptance in recent times are the following:

A three-member family from Attica, with an annual family income of 16,400 euros and a property of 91,700 euros, owned an up-to-date mortgage with real security, amounting to a debt of 124,500 euros. With the solution of the proposed regulation, he will be asked to repay a remaining loan of 76,100 euros, with a loan installment of 213 euros, which will gradually increase to 324 euros and a remaining repayment period of 420 months. In case of compliance with the regulation, she will receive a write-off of 48,400 euros, ie 38.8% of her loan.

A family of three from Attica, with an annual family income of 16,500 euros and a fortune of 80,400 euros, held an overdue mortgage loan with a security of 104,700 euros. With the proposed settlement solution, he will be asked to repay a remaining loan of 59,600 euros, with a loan installment of 166 euros, which will gradually increase to 253 euros and a remaining repayment period of 420 months. In case of compliance with the regulation, she will receive a write-off of 45,100 euros, ie 43% of her loan.

A two-member family from Ilia, with an annual family income of 14,400 euros and a fortune of 210,300 euros, held an overdue consumer loan of 41,900 euros. With the proposed settlement solution, he will be asked to repay the total amount of 41,900 euros, with a loan installment of 265 euros and a remaining repayment period of 240 months.

Loan arrangements

The 6th progress report on private debt published today by the Ministry of Finance includes the 632,998 loan arrangements (mortgage, consumer and business), totaling 35.85 billion euros, from July 2019 to the end of January 2022.

Also, from mid-March 2020 to the end of January 2022, the possibility of suspension of payment on 408,632 loans, amounting to 28.78 billion euros, was granted by Banks and Loan and Credit Claims Management Companies.

The data refer to the banks that send data through the Hellenic Association of Banks and the Association of Cooperative Banks of Greece, as well as from the Association of Loan and Credit Receivables Management Companies and PQH Unified Special Clearing SA.

Subsidies through Bridge I and II

Through the Bridge I and II programs, 557.67 million euros were given until the end of February.

Through the Bridge I program, which concerns the protection of first homes for natural persons, in February 2022, 12,670 loans were subsidized with 1.4 million euros, which correspond to 7,685 beneficiaries. The total amount of the state subsidy that has been paid to the beneficiaries of the program, until 28.2.2022, amounts to 250.1 million euros.

Through Bridge II, which concerns businesses, in February 2022, 13,454 loans were subsidized with 22 million euros, which correspond to 7,416 beneficiaries. The total amount of the state subsidy that has been paid to the beneficiaries of the program, until 28.2.2022, amounts to 302.9 million euros.

Also until February 2022, 2,984 beneficiaries were subsidized through the platform for the protection of the first home. The total amount of the state subsidy that has been paid to the beneficiaries of the program until 28.2.2022, amounts to 4.37 million euros.