Cyprus Mail
Cyprus

Insolvency boss says expects debt-relief applications to rise as foreclosures draw closer

More than 400 applications requesting exemption from debts and relating to the restructuring of loans have been filed with the Insolvency Service, according to its chief George Karotsakis.

But he said that as banks move to foreclose, he expected this number to rise.

Speaking to CNA, Karotsakis said that at the beginning of February five cases seeking to secure court orders to exempt debts and protect borrowers who have personal repayment schemes will be filed before the local courts.

Karotsakis explained that the court order to protect borrowers in essence means that creditors cannot take legal action against borrowers and guarantors for a period of 95 days, which can be extended for another 40 days.

He acknowledged that so far his service had not received masses of applications for personal repayment schemes because up until today the banks had not been pressing borrowers about the repayment of loans.

“Now that banks will increase pressure, borrowers will seek ways to restructure their loans, one of which is to secure a court order to protect them, something which will give them the time to enter into a personal repayment scheme,” he added.

He encouraged people to seek professional advice from insolvency practitioners, saying that at present there are 315 such practitioners, who acquired a license to practice this profession after successfully passing a relevant exam. (CNA)

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