By Vangelis Dourakis

Total “lifting” in the infamous out -of -court mechanism It expands the perimeter of the beneficiaries and at the same time puts a “brake” on … persistent banks and services to regulate the debts of “red” borrowers. The relevant data showed that the financial sector avoided arrangement of debts by utilizing this “tool”. Thus, the out -of -court had been substantially turned into an alternative debt settlement mechanism to the tax office and insurance funds.

It is indicative that until recently just a quarter of the debts they had settled were loan debts, while almost 75% are tax and insurance debts. For this reason, the Ministry of National Economy and Finance has made key interventions that differentiate the dynamics of the mechanism.

What does the arrangement promoted

Thus, the “privilege” that so far had very few vulnerable debtors, that is, to regulate their debts through out -of -court without being able to “block” the regulation by banks and servicers, is now expanding to an expanded number of debtors, as the relevant income is doubled.

Until now, a household with income from 7,000 to 21,000 euros could be included in the vulnerable category. These limits are now doubled: from 7,000 to 14,000 euros for a single household, to € 21,000 for two members, 28,000 euros for three members, 35,000 euros for four members and 42,000 euros for five members and above.

The assets, which will range from 240,000 euros to 360,000 euros, depending on the number of members of the family, are also adjusted.

In other words, a larger number of debtors will be allowed to be included in the category of “vulnerable”, which is foreseen that the arrangements with the Out -of -court mechanism They become automatically, that is, without the creditor (service, bank) to “block” them.

Obligation of Servicers to suggest setting up before auctioning

Even more interesting “improvements” are being promoted to facilitate debtors and Specifically:

  • It is provided for the creditor to have deposited a written proposal to the debtor prior to the auction. In all cases, the creditor is obliged to submit a proposal to the debtor before proceeding with auction by any appropriate means (mail, phone call, etc.). This will be done if the debtor has registered on the onlineized information platform to provide at least his email and phone number.
  • Debtors who cannot be bankrupt because they do not have the financial means to cover the costs of the bankruptcy procedure for which they are now set to register their name in the Solvency Registry will be permanently exempt from their debts by acting exemption from the court.
  • The deadlines are expanded to make the vulnerable debtor enter the intermediate program. Interested parties can currently apply up to 60 days before the seizure, freeze the auction and receive a loan subsidy. Instead of 60 days, the deadline is transferred at least 20 days before the auction. It also extends the intermediate program for four months, expiring normally in March.
  • The possibility of regulating public guarantees is expanded through the business consolidation process.
  • There is a permanent mechanism for compensation by a life guarantee in order to make more favorable arrangements for Aspis Providence Insured. So far there have been legislation for the payment of EUR 45 million to the injured. Instead of continuous arrangements, a permanent compensation mechanism is created, provided that compensation will not exceed 25% of the guarantee’s cash.