Bridge program for borrowers

Bridge program for borrowers

The government will subsidize loans secured on a main residence with between 300 to 600 euros per month, depending on whether they are serviced or not, according to a special clause inserted in the tax bill being debated in Parliament. The subsidized tranches will concern both performing and nonperforming loans, using a number of criteria for debtors hurt by the pandemic.

This new bridge program will last for nine months, Finance Minister Christos Staikouras said on Friday, adding that an online platform will open next month to that end, accepting applications by borrowers until September 30.

“We are now offering the ‘Bridge’ program, through which for the first time we are subsidizing corporate and mortgage loans with the primary residence as collateral,” Staikouras said.

According to the clause, as much as 90% of the monthly installments due by citizens hurt by the pandemic measures will be subsidized, provided these loans have been properly serviced, to a maximum monthly amount of €600.

For nonperforming loans, also including loans that have been recently arranged, the maximum subsidy is set at €500 per month, while for NPLs whose collateral is already about to go under the hammer, the ceiling is set at €300 and they will also be spared from auction.

Notably, for each application from an accountant or a lawyer, or any consultant of a borrower, there will be a compensation of €250 paid by the creditor of the borrower (i.e. his bank). That amount will be payable for each application.

Recipients of the subsidy can be individuals working in sectors hurt by the pandemic or unemployed people receiving extra support, or even salaried workers whose takings have been severely reduced. Also eligible are the professionals who have suffered a reduction to their commercial activity by over 20%, based on value-added tax data, in the second quarter, workers who have entered the “Syn-Ergasia” labor subsidy program and the owners of properties for which they collect a rent reduced by 40% by government order. 

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