The mortgage to rent (MtR) scheme for vulnerable lenders will come into effect on December 4, finance ministry permanent secretary George Panteli said on Friday, presenting the scheme at a press conference.

He added that it will come into effect in December, since the parliament has not yet officially passed the bill, and its discussion is scheduled for next Monday so that it can be sent to the plenum for a vote next Thursday.

Under a mortgage-to-rent scheme, intended to help homeowners at risk of losing their property due to mortgage arrears, a person voluntarily surrenders ownership of their home for five years to their lender. An entity buys the home from the lender and becomes the landlord. During that time, the borrower no longer owns their home but will continue living in it as a tenant.

MtR stipulates that applicants meeting the basic criteria – provided they have a title deed – will transfer title to asset management entity Kedipes, which at the same time will sign a 14-year rental contract with the individual concerned.

Panteli said that the fiscal cost of the plan is estimated at €200 million over the next two years, which corresponds to 0.9 per cent of GDP.

In his speech, Finance Minister Makis Keravnos said that the MtR plan complements the package of measures submitted by the government for the management of non-performing loans.

He called on vulnerable groups to take advantage of the opportunity offered to them, “which we consider to be a way out of the problem they are facing”.

The cabinet approved the scheme back in July 2023.