ECONOMY

Time’s up for strategic defaulters

Time’s up for strategic defaulters

The informal freeze on property auctions is coming to an end as the online platform for the settlement of bad loans will start operating in early July. After that, any borrowers with overdue obligations who do not apply for an arrangement will see their properties put up for sale, regardless of the value or their situation in terms of property assets.

The operation of the platform will lead to the revelation of the strategic defaulters, who are numerous: Court data show that one in every two applications for protection according to the old legislation known as the Katseli law is rejected.

At the same time, banks and the companies that have undertaken the management of their bad loans are preparing fresh proposals to make to borrowers who are having a hard time servicing their debts. These proposals, tested successfully abroad, will include the transfer of property ownership to the bank with the borrowers remaining as tenants.

Auctions have recently ground to a halt due to the pre-election period but will bounce back stronger than ever from September, as banks state they are determined to to be as tough as possible on those who turn their backs on any solution proposed, whether that be deliberately or due to misreading their situation.