In detail, the conditions that will come into force from January 1, 2025 regarding the borrower’s income and the value of the property
The Bank of Greece puts a ceiling on the amount of mortgage loans.
According to the Act of the Executive Committee of the Chamber of Commerce from 1.1.2025 an upper limit is set for the debt service to income ratioupon approval but also the loan-to-value ratio upon approval for new loans and other credits.
Specifically the cost of servicing the loan it will not be able to exceed 50% of the borrower’s income while the amount of the loan cannot exceed 90% of the value of the property.
More detail
* maximum allowable debt service to income ratio at approval (debt service-to-income at origination – DSTI-O) 50% for first-time buyers and 40% for other borrowers, and
* maximum allowable limit for the loan-to-value ratio of the secured property upon approval (loan-to-value at origination – LTV-O) 90% for first-time buyers and 80% for other borrowers.
These macroprudential measures do not apply to non-performing loans and loans under regulation (within the meaning of Articles 47a and 47b respectively of Regulation (EU) No. 575/2013 of the European Parliament and of the Council), in loans and other credits linked to national housing policy or green transition programs, which are governed from more specific terms and conditions (such as the programme “My house”)as well as in transferred portfolios from loan and credit management companies of Law 5072/2023.
Also, it is possible to disburse loans and other credits in excess of the maximum permitted DSTI-O and LTV-O limits.
The excess per index may amount to up to 10% of the total number of loans and other credits that are approved and have been at least partially disbursed within each calendar quarter.
Source: Skai
I am Janice Wiggins, and I am an author at News Bulletin 247, and I mostly cover economy news. I have a lot of experience in this field, and I know how to get the information that people need. I am a very reliable source, and I always make sure that my readers can trust me.