ECONOMY

Gov’t will not renew home repossession ban

The Development Ministry appears unwilling to grant another extension to the implementation of a law protecting primary residences from repossession by banks over unpaid debts, as it believes that the legal framework dating from 2010 is sufficient to protect homeowners in financial difficulties.

The current ban on repossessions expires on December 31 and the government believes that the application of a new code of conduct for banks as of January 1 will offer more flexibility to lenders and borrowers for settling loans. The risk of property liquidation will only exist for clients that banks consider to be “non-cooperating borrowers.”

A key part of the ministry’s decision lies in a declaration by the country’s banks that they are not interested in massive property auctions.

“With the code of conduct applying from January 1, which is binding for banks, the main residence is not at risk for borrowers in financial hardship,” said Development Minister Costas Skrekas pn Monday.

Primary residences are protected from repossession for debts to banks if their value is up to 200,000 euros and the owner’s annual income does not exceed 35,000 euros.