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Greece’s Debtors’ Day: Foreclosures, evictions, confiscations, “first residence” under protection till end of 2015

For thousands of Greek debtors the month of November did not start well. As of today, Monday, November 2nd 2015, thousands of debtors are at risk to foreclosure, evictions and confiscation of everything they own. Under certain circumstance the “first residence” is still under protection and thus until the end of the year.

Under the creditors’ pressure, the government was unable to extend the decision on protection from “foreclosures, evictions, confiscations, auctions and imprisonment”. According to a joint ministerial decision of  July 21st 2015 due to the capital controls the enforcement of auctions and evictions was ‘suspended. But now the mercy period is over.

The Finance Ministry clarifies that the first residence is still under protection, however that a final solution is yet to be found. According to Greek media, there is an informal moratorium valid for the protection of the first residence. On July 21st 2015, the Greek Banks Union had issued a decision according to which “the Greek banks would continue to protect the borrowers’ first residence until the end of the year.”

Officially the protection from foreclosure and eviction of the first residence ended on 31. 12. 2015. The Samaras’ government did not extend it, knowing since November that it would soon be out of the government.

Of course, foreclosures and evictions even of the first residence can indeed take place as of beginning of December for debts and loans of other kind. the Finance Ministry is allegedly confident that by then a solution for the protection of the first residence will have been found.”

The Greek government wants the value of the protected first residence to be up to 200,000 euro, the creditors want to lower the protection cap down to 120,000 euro. The government’s proposal covers 74% of the owners/debtors with first residence, the creditor’s proposal covers just 20%.

You got mail – very bad mail!

As of December some 100,000 members of social insurance funds with debts that they do not serve or they do not pay the tranches of the debt settlement are at risk to so-called “electronic seizure”. They will simply see their bank accounts be seized.

This measure concerns those who owe more than 5,000 euros to the social security funds. It is said that affected will be  275,000 debtors owing a total of 12.9 billion euro. Of those, some 100,000 people owe to the funds more than 5,000 euro. This target group of debtors is on top of the list of the Finance Ministry.

PS I must confess that the issue is a bit too complicated for my intellectual capacities. Therefore, I dare say that what I understand is this: the lifting of protection refers to to debtors to social insurance funds (state) and to banks (private). So far, the first residence is protected from foreclosure and eviction until the end of the year and thus independently of whether the first residence is linked to a bank loan for its purchase or to other debts of the property owner.

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One comment

  1. And now it will turn very ugly. As with cats cornered, people with nothing left and nothing left to lose might react dangerously.

    And who will buy up all these foreclosed homes? GS like in Spain?