“Freeze” of auctions for the period from 1 to 30 June

The Treasury Department and banks have decided to suspend the first housing auctions for all vulnerable borrowers.

The moratorium on auctions is valid from 1 to 30 June. At the same time, citizens must send the latest E1 income statement and E9 real estate declaration to the bank or their credit manager to prove that they belong to the category of vulnerable households.

We will remind, as “Russian Athens” wrote earlier, in 2020 Greek banks intended to resume auctions for the sale of alienated property, starting in October.

The auctions were suspended during the coronavirus pandemic, according to Katimerini, but banks that have securitized bad debts, funds that want to buy back such debts, and service companies that manage loans are all pushing for the moratorium to be lifted.

The resumption of auctions is considered vital in view of the planned securitization of debt, which requires a clear regulatory framework to attract investors willing to buy such debt.

Three of Greece’s “big four” retail banks – Alpha, Efniki and Piraeos – were planning a € 25bn securitization, hoping that the return of property auctions would boost investor confidence. The ability of banks to hold auctions affects the pricing of upcoming securitizations, and any extension of the suspension will lower the valuation of debt portfolios for sale.

Real estate auctions have been frozen since March 2020. The payment of installments for housing, consumer and business loans was also suspended. This moratorium is associated with nearly 20 billion euros in debt and has been extended for a significant portion of these loans until the end of the year. According to the bank, about 70-80% of loans, on the repayment of which were subject to a three-month moratorium that ended in June, are now paid on time. This gives some optimism that the pandemic crisis will not create too much additional debt.

Those who mortgaged their primary housing for a home or business loan could apply for assistance through the Gefyra (“Bridge”) program, which subsidizes repayment for nine months (the application deadline was set at the end of September 2020) …

Bank and fund managers say those who have not settled on the repayment schedule by then should be considered “strategic defaulters.” “Liquidating their property is the only way to get them to enter into an agreement with a bank or funds,” they say.

Three of Greece’s “big four” retail banks – Alfa, Efniki and Piraeos – were planning a € 25bn securitization, hoping that the return of property auctions would boost investor confidence. The ability of banks to hold auctions affects the pricing of upcoming securitizations, and any extension of the suspension will lower the valuation of debt portfolios for sale.

Real estate auctions have been frozen since March 2020. The payment of installments for housing, consumer and business loans was also suspended. This moratorium is associated with nearly 20 billion euros in debt and has been extended for a significant portion of these loans until the end of the year. According to the bank, about 70-80% of loans, on the repayment of which were subject to a three-month moratorium, ended in June, are now paid on time. This gives some optimism that the pandemic crisis will not create too much additional debt.

Those who mortgaged their primary housing for a home or business loan could apply for assistance through the Gefyra (“Bridge”) program, which subsidizes repayment for nine months (the application deadline was set at the end of September 2020) …

Bank and fund managers say those who by then have not settled on the repayment schedule should be considered “strategic defaulters.” “Liquidating their property is the only way to get them to enter into an agreement with a bank or funds,” they say.

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