By Angelos Anastasiou
IN THE aftermath of the recent heated debate on the proposed protection of primary residences from repossession for defaulting borrowers, DIKO deputy Zacharias Koulias has tabled an alternative proposal for the protection of borrowers’ “primary car” from repossession.
On Thursday, Koulias submitted a bill to the House that would amend civil procedure law so as to exclude the forced sale of cars used in the context of borrowers’ transport or work needs.
“The proposed bill protects the car a borrower uses for his or his family’s transport or work for up to six months,” Koulias told the House.
He noted that current legislation already provides for the safeguarding of some basic needs for borrowers and their families, including the means necessary to conduct business, for a period of up to three months.
“To these, I propose that we add the primary car,” Koulias said.
He argued that based on modern social and financial conditions, the car is an individual’s basic and necessary means of transportation, which is why its protection is required.
Back in March, a bill tabled by opposition parties – communist AKEL and socialist EDEK – offering indebted homeowners two-year protection against foreclosure of their primary residence had almost made it to the plenum despite strong government opposition and Troika disapproval.
The bill had also nearly made it past the Legal Affairs committee but was overturned by a steamrolling DISY leader Averof Neophytou, who attended the session that would vote for its submission to the plenum and imposed the government’s will with the blessing of DIKO committee members.
It had then been argued that offering such protection would leave banks exposed to ‘strategic’ defaults, meaning borrowers who could afford to repay their loans would be tempted to simply opt to make use of the protection clauses and stop paying.
Instead, the government said, a comprehensive ‘insolvency framework’ was being prepared and would be submitted to the plenum by year-end, which would allow banks the flexibility to collect on their dues and protect borrowers in trouble by facilitating loan restructuring so that foreclosures are avoided to the extent possible.