The state funds will be used to pay part of the loans approved by the authorities for inclusion in the Estia plan, which aims to protect primary residencies and help banks cut their bad debts. The government will cover 33% of the installment paid by borrowers on their restructured loans.

The head of the scheme at the labour ministry, Marios Savvides, said banks have so far forwarded 5,122 applications to the ministry from the 6,385 worth €1.9 billion filed by borrowers who want to enter the scheme.

Through the Estia Scheme, the state would pay 33 % of bad debts on primary residences, valued at below €300,000, on condition that the debtor would agree to make regular repayments to the bank. There was little interest among debtors to start with and the government kept putting the deadline for applications back.

Of the 5,122 applications received by the labour ministry, 3,287 have all the necessary accompanying documents, 1,477 were incomplete, and 47 have been withdrawn.

Savvides said 311 applications concern special cases, which will be dealt with by the finance and labour ministers.

The total number of applications on the way to approval are 580 but only 56 have been given the green light so far. The rest require some additional information from the banks.

The labour ministry official said 517 applications will be forwarded to the finance ministry for further handling because 452 were deemed unviable while 65 concerned loans that were restructured before the scheme was rolled out.

The chairman of the association for the protection of the primary residence, said the ministry has not yet examined all complete applications so he could not talk about a success rate.

Stavros Papadouris said they were satisfied that the finance ministry would consider the unviable cases, which were the most tragic category.

“This category has nothing to do with the definition of strategic defaulter,” he said.

Source: Cyprus Mail