State to pay 20-50 pct of eligible debtors’ dues

State to pay 20-50 pct of eligible debtors’ dues

The state promises to subsidize the installments of financially challenged households for repaying their dues to their creditors by between 20 and 50 percent, whether they reach a settlement in court or via the out-of-court mechanisms to protect their main residence from repossession.

While the subsidy rate will depend on each household’s dues and income, the subsidy for corporate loans secured against the debtor’s primary residence will have a flat rate of 30 percent if the borrower meets the criteria set.

This is the upshot of the joint ministerial decision signed on Monday by the ministries of Economy and Labor, for the implementation of the new framework for the protection of debtors’ primary residences.

The subsidy will only be granted if a debtor meets all the criteria in place, concerning the value of their main residence, the amount due, the total value of their assets (realty or other) and the level of income, which constitutes the basis for the rate of the subsidy to be granted. The decision provides for the approval of subsidy applications within 15 days of submission on the online platform set up for the new protection framework.

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