Full facelift up to extrajudicial mechanism announced the Minister of Finance Christos Staikouras to improve the efficiency of the process, and expand the perimeter of loans that can be regulated. Among the improvement steps that will be immediately adopted by legislation are the following:

1. Elimination of the penalty for early repayment of debts to the state and lowering the interest rate to adjust these debts from the current euribor +5% to +3% euribor. Recall that since October last year, reduced spreads also apply to loans regulated by financial institutions (banks and management companies). In particular, for loans with a mortgage, agreements are concluded with euribor +2.50%, and for loans without mortgages with euribor +3%. The spread reduction now also applies to the repayment of debts to tax authorities and insurance funds, in combination with the elimination of the prepayment penalty, which until now only applied to debts to the state.

The Minister of Finance announced four measures to improve the mechanism.

2. Expanding the scope of the out-of-court mechanism to include lump sum debtors. To date, a debtor is not allowed to apply to an out-of-court mechanism if 90% of his total debt is owed to one financial institution. This excludes those with a single debt to the institution, which should be abolished, expanding the scope of the mechanism. It will also now be allowed to include individual debts that have not been repaid, provided that they do not increase the monthly payment by more than 15%. Until today, in order to join the extrajudicial mechanism, one had to pay off all one’s debts. So, if he already had an arranged loan, for example. mortgages with a bank and two other consumer mortgages with other banks or management companies, he could not settle them, since the bank did not agree to reissue the mortgage when it was serviced in the usual way. He will now be able to settle his remaining debts out of court, provided that the total increase in the amount he has to pay does not exceed 15% of what he has paid so far.

3. Inclusion of new categories of debt that can be regulated, such as debts to third parties, which are collected by the tax administration.

4. Mandatory justification of disagreement with the regulation proposal produced by the algorithm, both on the part of financial institutions and debtors, and public posting of the justification on the platform. According to the records of the out-of-court mechanism, of the 1.8 billion euros assessed by financial institutions, 66% have been approved, i.e. 1.2 billion euros, and one of the main reasons for the refusal is the failure to submit an application on the part of the co-debtor – co-guarantor, as well as the fact that the debtor has already paid off one of its debts. Publicizing the reason for the rejection of the ruling will help increase the efficiency of the institution by increasing the approval rate. The corresponding obligation to disclose the reason why they are withdrawing from the agreement is now also established for debtors, who have an even higher withdrawal rate. According to the platform, out of the 2.7 billion euros of debt proposed for regulation, 56%, i.e. to achieve better regulation in the future!