Agreement on protection of first homes a positive step, banking sources say

An agreement reached between the Greek government and banks over a new framework for protecting primary residences, replacing an existing framework ending at the end of February, is a positive step, banking sources told the Athens-Macedonian News Agency (ANA) on Friday.

The sources said this was a pending issue that needed to be resolved for the benefit of all parties involved, while they underlined that a gap separating the two sides’ positions at the beginning of discussions has been significantly reduced. They noted that the challenge was to protect those really in need and to avoid putting banks’ balance sheets at risk. At the same time, it was imperative to restore a payment culture and combat the phenomenon of strategic defaulters.

 The sources said that details and the full process of the new legislation will be submitted to the supervising institutions for consultation. The basic criteria agreed between the government and banks include, according to information: an objective value of the real estate property up to 250,000 euros, an outstanding loan debt of up to 130,000 euros and a family income up to 35,000 euros. The new protection framework will also include an extension of the loan and in several cases a haircut of the debt. Also, a state subsidy of up to 25 years will be offered.


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