Wednesday’s “warning bell” by the EU Commission apparently proved to be the fillip for the Greek government and the country’s four systemic banks to come to an agreement over a new framework to protect primary residences from creditors.
The development, which must be conveyed into print and then submitted for ratification in Parliament, comes a day after the current framework expires, and on the back of repeated warnings by European creditors to finalize the deal.
According to reports, whatever subsidization of a monthly mortgage payment by the state, after a “haircut” of the non-serviced loan of eligible borrowers and a new installment plan, will automatically be calculated by a relevant e-platform.
No new court decision will be necessary, thus bypassing the creaky Greek lower court system.
At banks’ insistence, a “grace period” of only nine months will then be extended, meaning that a foreclosure process can then commence if the loan remains non-serviced – and after the restructuring.
Also, applying for protection under the new framework does not automatically mean that the process commences.
Additionally, only the NPL is eligible for protection and not a borrower’s total arrears.
