articles | 02 November 2020

70 per cent of mortgage relief cases processed

Banks have processed around 70% of 6,442 applications in a state-backed mortgage relief scheme to the labour ministry, it emerged on Monday.

Head of the scheme at the ministry Marios Savvides told the Cyprus News Agency that by October 31, banks had sent 4,573 applications for inclusion in the scheme

Total applications represent some €1.9 billion in loans.

The Estia programme was proposed in the wake of the 2013 financial meltdown to help people with non-performing loans (NPLs) retain ownership of their main residence.

The plan would also contribute to deleveraging Cypriot banks.

Savvides said he expected the process to finish by the end of the year.

The ministry official said 3,066 of the 4,573 applications were complete while 1,260 still required some accompanying material.

Thirty-six applications have been withdrawn.

Savvides said the ministry has so far sent 1,000 rejection letters while 356 applications concerned financially unviable borrowers who will be referred to the finance ministry.

Three of the main reasons for the rejections were failure to meet the income and property criteria, as well as the one on credit facilities.

Those qualifying for the relief will see their home loan written off by at least 5%, where the value of the mortgaged home is higher than the loan amount; in cases where the home value is lower than the loan amount, the amount written off is the difference between the market value and the loan amount.

From the amount remaining after the loan write-off, the state will pay 33% of the installments.

Source: Cyprus Mail

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