BUSINESS

Auction threat spurs debtors to cooperate

EVGENIA TZORTZI

TAGS: Banking, Economy

Three in every five defaulters put off going to the bank to ask about debt arrangement until just one day before the lender forecloses on their property, according to bank figures. Data also show that one in five debtors actively tries to reach a deal only after the start of forced measures (i.e. the termination of the loan agreement).

The debtors who don’t try to reach a settlement until the last minute are usually prepared to pay some of the money (e.g. some of the overdue payments) in order to avert the auctioning of their assets or the termination of their loan contract, and then are inclined to discuss some form of arrangement with their bank. The positive aspect of that is that, often after years, they do finally turn up and find a solution with their lender, thereby resuscitating their loan.

Banks are prepared for the registration of some 15,000 properties on the new online auction platform, which will gradually form part of the foreclosure schedules for 2018 and 2019. The lenders’ focus at this stage is on industrial and commercial assets, as well as on homes that would fetch a substantial amount of money and are not the main residences of small debtors. These include primary residences and holiday homes of well-known names from the business world.

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