The cabinet on Wednesday extended the deadline for applications for the ‘Estia’ mortgage relief scheme as submissions have so far failed to meet the expectations.
According to deputy government spokesperson Klelia Vasiliou, the cabinet extended the deadline to the end of this year.
The government had expected around 10,000 applications for debt relief but by early October, only a few hundred had filed.
Lawmakers said the trickle of applications is due to the complexity of the application process.
The application form itself is more than 30 pages long, while applicants must gather and append about 40 to 50 different types of documentation – requiring a great deal of time and effort.
But it’s also understood that prospective applicants are wary of disclosing information about other assets or income, which might lead to capital or tax audits.
The programme applies only to loans (mortgages) that were deemed non-performing as at September 30, 2017. Loans designated as non-performing after that date are not eligible.
Estia applies to the first mortgage on a residence and covers loans or credit facilities regardless of currency.
If eligible, an applicant’s loans will be written down to the market value of the primary residence and then the borrower will have to pay two-thirds of the rescheduled loan every month while the taxpayer (the state) will subsidise one-third of the monthly instalments on that rescheduled loan.