The position of Mr. Pavlos Ioannou regarding the written statement of the Minister of Finance
With the written statement of the Minister of Finance Constantinos Petridis in relation to the sales, dated 2/2/2023, all the main residences related to the Home Plan and Rent in installments are covered, reports the Financial Commissioner Pavlos Ioannou.
In his briefing note on the occasion of various public discussions fueled by the Ministry of Finance's statement on the issues it faces and the various questions and concerns, which, forwarded to his Office, the Financial Commissioner notes the Ministry of Finance's statement that “no divestment process will initiated either by a Banking Institution, or by Credit Acquisition Companies (EEP) which is covered, either by Hestia, or by the installment plan against rent” and that “an agreement made in the past between the Ministry of Finance and the Association of Banks is relevant” .
According to the Commissioner, “although as can be seen from the wording above, the relevant agreement was made with the Association of Banks to which the EEPs do not belong, nevertheless I believe that this statement covers all the main residences related to the Home Plan and the Rent for Installment, because, quite simply, the Minister of Finance has at his disposal enough means to enforce the validity of his intention to do so, to any entity that manages loan contracts, secured by mortgages, with property that is a primary residence”.< /p>
Therefore, according to Mr. Ioannou, the said statement of the Ministry of Finance implies the protection of the main residences up to €350,000, for which an application for inclusion in the Hestia Plan was submitted and which applications were rejected, because the borrower was deemed unviable, as well as all the main residences worth up to €250,000, for which either an application has been submitted to the Home Scheme or not, provided that the owner meets specific income criteria.
He notes that from what is known to date, the main income criterion consists of the borrower being a recipient of public assistance.
With regard to the obligation of Credit Acquisition Companies, the Financial Commissioner reports that the Minister of Finance's statement includes “an excellent, important and absolutely correct wording”, according to which “the provisions on the Purchase and Sale of Credit Facilities and Related Matters of Law are clear and binding for the parties and sufficient for the EEPs to undertake all the obligations and perform the actions attributed to them as the buyer/new creditor of the credit facility approved in the ESTIA Plan” and that “this is also the position of of the Financial Commissioner which was expressed after a relevant complaint and which I fully adopt”.
This wording, according to the Commissioner, as well as his own position, is a consequence of the provisions of the 2015 Law on the Purchase and Sale of Credit Facilities and Related Matters, namely Article 18(2)(a), which provides that “any credit facility is transferred by a credit institution, financial institution or credit acquisition company (hereinafter “the transferor”) to any of the buyers provided for in subsection (1) of article 4, it is considered that it is transferred to the buyer at the time of the transfer and all rights and obligations arising from the credit facility agreement of the account so transferred, are automatically transferred to the relationship between the borrower and the buyer and remain valid between these two parties”.
It also mentions that article 18(5) of the same law provides that “where any document, whenever made or executed, contains or implies any reference to the assignor, then, to the extent that such document concerns any right or obligation transferred to the purchaser of the credit facilities, such reference shall be read, construed and effective as a reference to the purchaser at and after the time of transfer, except where the relevant text otherwise requires”.
In addition, the Financial Commissioner states that he has observed that ” some AEPs do not always behave faithfully following the letter and spirit of the above Law, as a result of which problems are created, illegally, for the borrower and other persons involved in the loan contracts” and emphasizes that from now on, he will publicize any such conduct, on behalf of EEP.
“The consequences of the above provisions of the Purchase and Sale of Credit Facilities and Related Matters Law of 2015, do not only concern the obligation related to the Home Plan, but also any other obligation assumed by the assignor of the loan agreement to the borrower or any other relevant customer of his, before the sale of the loan agreement, which, according to the above, is transferred to the EEPs, which are obviously bound by this obligation”, he underlines.
Also, the Commissioner mentions the fact that “there are cases of EEPs, which, after a simple but thorough letter from me, reformed their attitude and corrected their actions and/or omissions, so as to be consistent with the provisions of the Credit Facility Sale and Related Matters Law of 2015”.
Finally, the Financial Commissioner points out that it has nothing to do with the formulation of the criteria of the Plan in question, because this is not part of the competences his.