Expected in the coming days banks plan mechanisms unveiled in detail which is in the final stage of processing and provides for a “freeze” of the interest rate Evriboron the basis of which floating interest rates in Housing loan and led to a significant increase in the cost of borrowing in recent months.

This will also apply adjustable rate mortgagerelated to the level of ECB intervention.

Banks plan, which was one of the topics discussed at the meeting of bank representatives with the Minister of Finance Christos Staikouraswhich on an ongoing basis calls on banks to act in this direction, includes all home loans, as related to first residence as well as loans for secondary residenceprovided that these are loans with a floating interest rate and normal service.

Red loans repaid and serviced

Also includes “red” mortgages that have been regulated and are currently serviced as usual; and repair loans provided in addition to mortgages.

The practice that was common in the past, when financing the purchase of real estate was even with zero equity of the borrower, has changed today, as banks provide loans for the purchase of real estate at a rate of 70% to 80% with the rest covered by the borrower’s equity.

The majority of mortgages, according to convergent estimates, more than 90% of the loans they have in their portfolios, have floating interest rates, given that the transition to fixed interest rates has occurred over the past two years. .

Freezing mortgage rate hikes from the Euribor hike is expected to give borrowers a breather and a sense of security, and prevent any possibility of a new generation of bad loans. .

The plan will take into account and strictly follow the oversight rules set by the SSM and the Competition Commission, as it does every time such actions and initiatives are taken.

The number of loans that will be affected by these new announcements, expected likely before Easter, is between 400,000 and 500,000 loans, according to converging bank estimates.

Taking into account the fact that some borrowers have a home improvement loan along with a mortgage, the number of borrowers who will benefit from this plan is approximately 350,000.

Youth and young couples have also started to apply to banks for interest-free or concessional loans.

In addition, as of Monday, April 3, young people and young couples will no longer apply to banks for interest-free or soft loans at an interest rate corresponding to a quarter of the normal market interest rate, and the purchase of the first house has begun.

Under the program, over 10,000 beneficiaries can purchase a private residence throughout the year at a monthly installment significantly less than market mortgages, as 75% of the capital is provided by the Public Employment Service (PYPA). interest-free, and for three-children and large families (and those who acquire this status upon repayment), the loan is provided completely without interest.

Thus, borrowers will have a significantly lower down payment compared to bank-issued mortgages and therefore a much lower burden than any increases in bank interest rates that have been or could be made due to the international crisis.

The housing loan program is part of the state housing policy “My Home” established by Law 5006/2022. The National, Piraeus, Alpha, Eurobank, Attica Bank, Pankritia banks, as well as the cooperative banks of Epirus, Thessaly, Karditsa and Chania, which have announced initial interest rates on subsidized loans, participate in the program.

The beneficiaries of the program are people aged 25 to 39 years at the time of applying for a loan or married couples (one of them must meet the age criterion), the criteria for which have already been announced.

RES – OIE