Cyprus Finance Minister Harris Georgiades has urged borrowers who have defaulted on their mortgage and are eligible to participate in the ESTIA scheme to submit their applications so that they receive the state subsidy.

He said the project "is finally kicking off and I want to invite all of our fellow citizens who are affected to apply, as I think it will provide tangible help to those who need it".

The ESTIA scheme has been approved by the European Commission with a budget already in place.

Defaulted borrowers interested in taking part in the scheme will have to submit their applications to the banking institution to which they owe their mortgage, providing that the bank is also participating in the scheme.

Bank of Cyprus, Hellenic Bank, Cyprus Asset Management Company (KEDIPES), Alpha Bank, Astrobank, Eurobank, the National Bank of Greece and Gordian Holdings signed the Memorandum of Understanding with the Government for participation in the scheme.

Under the scheme, the state will cover one third of the eligible borrowers’ repayment plan, while the banks will reduce the loan’s outstanding amount to the value of the primary residence.

Eligible applicants are those that used primary residence as collateral with a market value of €350,000 maximum and as of September 30, 2017 their loans were classified as non-performing.

Income and household wealth criteria apply for applicants of the scheme.

The government has estimated a budget of €32 million per year for a maximum of 25 years to cover the scheme.

Value of the restructured loans amount to €3.4 billion with the total state outlay amounting to €815 million for the duration of the scheme.

Applicants must also meet the following criteria in order to be eligible to join the scheme:

Total Family Income should not exceed €60,000 annually for a family of at least four dependent children, €55,000 for a family of three dependent children, €50,000 for a family of two dependent children, €45,000 for a family with one dependent child, €35,000 for a family with no dependent children, €20,000 for a household of one. The same applies to single parent families.

Source: Financial Mirror