Greece’s Minister of National Economy and Finance Kyriakos Pierrakakis outlined a bill to strengthen borrower protections in an interview on SKAI television ahead of its parliamentary vote. The bill would impose deadlines on loan servicers, cap upfront payments and increase fines for servicers tenfold. It would also provide fixed interest rates for qualifying borrowers using the out-of-court debt settlement mechanism. For vulnerable and eligible borrowers under that mechanism, the proposals would replace an arrangement offering a 3% rate for the first three years followed by a variable rate linked to Euribor with a fixed 3% rate. Pierrakakis cited potential savings of EUR 28,000 for a borrower owing EUR 100,000 over 20 years. As background, a separate change introduced in late September allows borrowers to protect their primary residence through the mechanism, with 675 people having joined. A provision concerning a consensual enforcement procedure had been withdrawn from the bill. Pierrakakis described the withdrawn provision as preserving borrowers’ right to challenge enforcement in court.
Greece’s Ministry of National Economy and Finance outlines borrower protection bill with tenfold increase in loan servicer fines
In a SKAI television interview, Greece’s Minister of National Economy and Finance Kyriakos Pierrakakis outlined a pending bill imposing deadlines and caps on upfront payments for loan servicers, alongside a tenfold increase in fines. The proposals would also make the 3% interest rate fixed for vulnerable and eligible borrowers using the out-of-court debt settlement mechanism, replacing the switch to a variable rate after three years.