President calls for meeting on foreclosures issue

President Nikos Christodoulides has called for a meeting with all political parties at the presidential palace on Monday, to discuss foreclosures.

The aim is to hold a discussion ahead of plenum’s vote over two bills aimed to tackle non-performing loans (NPLs). The meeting is set for 6pm at the presidential palace.

Meanwhile, Finance Minister Makis Keravnos is also slated to be at the joint House finance and legal committee in parliament on Monday morning, to brief MPs over the government proposals.

During Thursday’s plenum, deputies decided to postpone voting two bills that aim to tackle the issue of NPLs, including a proposal that would allow debtors to set aside repossessions with a court order.

It has since been delayed to the following Thursday.

“The finance ministry has been working intensively for the past two to three weeks to prepare everything,” undersecretary to the president Irene Piki told the state broadcaster.

She specified the ‘mortgage to rent’ scheme is slated to be approved in next week’s cabinet session, while the finance ministry is trying to prepare all the details on how people would be able to apply.

“It aims to help vulnerable groups.”

Another proposal the government is trying to thrash out ahead of plenum’s vote is to amend the existing Estia scheme, with new income criteria.

Piki anticipated this will take “quite some time” as it also needs approval from competition authority.

Last week, cabinet decided foreclosures will be suspended until the end of October, to give government time to prepare a holistic package of measures. Lenders also agreed to desist from home repossessions for primary residences valued at €350,000.

The government proposals, leaked to the Cyprus News Agency, build on Akel’s idea on debt-for property swaps at the market value of the property, rather than the price of a forced sale.

On the Disy-Diko joint proposal that repossession notices must cite the outstanding debt balance, the finance ministry adds that banks should also cite the dates of any and all notices sent to a debtor.

Regarding the mortgage-to-rent scheme, Keravnos outlined to parliament that it has got the green light from the European Commission. Further, the scheme will be communicated to banks and credit-acquiring companies, who have until September to join the scheme.

The government package also includes the intention to let the financial ombudsman hire more staff.