Banks are now able to efficiently sift through the applications pending for protection of primary residences from foreclosure, as on Friday the online platform for that purpose was launched, tightening the noose around strategic defaulters.
The platform allows banks to collect debtors’ income tax and property asset data, so as to establish whether they fulfill the criteria for entering the law’s protection status for primary residences.
If a bank identifies a borrower as a strategic defaulter (i.e. someone who has the income and/or assets to able to pay but chooses not to), then it will be able to take legal action to terminate their protection under the law. Similarly, applications from those found capable of debt repayment will be rejected.
The development and operation of the platform was deemed necessary after the banks realized there many debtors have submitted applications for protection of their primary residence without fulfilling the necessary criteria. Such borrowers apply for protection in order to buy time, as banks are unable to proceed to forced measures (such as auctions) until the application is processed and the case is tried in court, which can take up to five years.