Platform for 300,000 mortgage loans affected by coronavirus opens Aug 3

The platform allowing borrowers to submit their applications to join the Bridge-Program is expected to open August 3, with the relevant bill being voted by parliament by the end of the week.

The program concerns subsidies offered on mortgage loan installments to those who have been affected by the coronavirus, as Friday is the last day that the current framework for home protection applies with the new bankruptcy code coming into effect as of next year.

Speaking to NPL Confidential, bank officials estimate that more than 300,000 home loans will be included in the bridge program, of which 200,000 are up to date loans and the remaining 100,000 are non-performing and denounced loans.

Nevertheless, the same sources add that the final number of beneficiaries will emerge after the agreement between banks and borrowers, mainly in terms of non-performing loans.

Details of the plan
As reported by NPL Confidential, the government’s plan stipulates that the subsidy reaches up to 90 percent of the monthly installment for those affected by the health crisis and have kept paying normally their bank loan with a maximum of 600 euros.
For non-performing loans, including recently settled loans, the maximum grant is limited to 500 euros, while for non-performing loans that have already been denounced and are being led to an auction (in a bid to prevent it) the subsidy is even lower and reaches 300 euros.

The relevant online platform is expected to open in August and will accept applications until September 30, 2020.

The subsidy
The program provides for three categories of borrowers and an increase of the subsidy, rewarding borrowers who were consistent in servicing their loans until the outbreak of the pandemic crisis. In detail, the following will apply:
1. Up to date loans. The subsidy amounts to the 90 percent of the monthly installment in the first quarter, 80 percent in the second quarter and 70 percent in the third quarter. The eligibility criteria are:
· The value of their main residence should not exceed 300,000 euros.
· The loan balance should not exceed 300,000 euros per lender.
· The family income should not exceed 57,000 euros
· Deposits should not exceed 40,000 euros
· Total real estate owned should not exceed 600,000 euros
For loans in this category, the maximum monthly subsidy can reach 600 euros.
2. Non-performing loans. The subsidy is 80 percent of the monthly installemnt in the first quarter, 70 percent in the second quarter and 60 percent in the third quarter. The eligibility criteria are:
· The value of their main residence should not exceed 250,000 euros
· The balance of the loan should not exceed 250,000 euros
· The family income should not exceed 45,000 euros
· Deposits should not exceed 25,000 euros
· Total real estate owned should not exceed 500,000 euros
For loans in this category, the maximum monthly subsidy can reach up to 500 euros.
3. Non-performing loans that have been denounced. The subsidy is 60 percent of the monthly installment in the first quarter, 50 percent in the second quarter and 30 percent in the third quarter. The conditions are:
· The value of their main residence should not exceed 200,000 euros
· The balance of the loan should not exceed 130,000 euros
· The family income should not exceed 36,000 euros
· Deposits should not exceed 15,000 euros

· Total real estate owned should not exceed 280,000 euros

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