ECONOMY

Plan to lighten load for mortgage holders

The government has proposed a plan to banks for lightening the load on borrowers who may be unable to repay their mortgages.

The proposal was presented by Development Minister Costis Hatzidakis late on Monday to the Hellenic Bank Association and provides for a grace period of four years during which borrowers with low incomes will only have to pay interest at a fixed rate of just 1.5 percent.

It also suggests that the amount of the installment should not exceed 30 percent of the monthly income of each borrower, and that house repossessions and auctions be frozen for the whole of 2013. Borrowers’ associations criticized the government on Tuesday for saying nothing about consumer loans or reducing interest rates for borrowers.

“It forces borrowers to pay eternally for their loans,” said Panayiota Kalapotharakou, director of consumer association EKPIZO, on Skai television.

“The government is not trying to impress borrowers, but to help them,” countered Deputy Development Minister Thanasis Skordas on Skai Radio.

He stressed that any solution given should not upset the capital adequacy the state could secure after the recapitalization of the banking system.