Filenews 27 January 2024 - by Eleftheria Paizanou
A few weeks after the strengthening of the legal framework for foreclosures, with the extension of the responsibilities of the Financial Ombudsman and with the right of borrowers to appeal to the Special Jurisdiction, five directives concerning the Body for the Extrajudicial Settlement of Financial Disputes were published yesterday in the Official Gazette of the Republic.
At the same time, the forms that beneficiaries will fill in to submit a complaint to the Agency have been published. In particular, the change of the five directives was due to the amendment of the law. Since last December, more borrowers have been able to apply to the Financial Ombudsman to have their loan restructured.
The complaint procedure
The first complaint form concerns natural persons who turn against a financial company for a dispute up to the amount of €250,000. The second form concerns the filing of a complaint against banks by an eligible debtor regarding the amount of debt required. The debtor has the right to submit a relevant complaint to the Agency, when his main residence, worth up to €350,000, is in danger of going under the hammer. and which is collateral on the borrowing received from the bank. It is worth noting that the property under sale should be used by the eligible debtor for six months a year as the main residence of himself and his family members.
In addition, the debtor should have received letters of formal notice from creditors, as well as the final letter informing him that his property will be put up for auction. It is noted that when he/she has received the relevant notification from the creditors, he/she will be able to appeal to the Agency and file a complaint within 21 days. Also, in order for someone to apply to the Agency, no court decision or order for registration and enforcement of an arbitral award should have been issued and there should be no ongoing court proceedings or procedure for registration and enforcement of the arbitral award.
The third form concerns a legal person, charity, association, association, trust or provident fund. Through this form, legal entities etc. will be able to file a complaint with the Financial Ombudsman against a financial company, for a financial dispute worth up to €250,000.
The fourth form will be used by natural persons to apply to the Out-of-Court Dispute Resolution Body for the appointment of a mediator for the purpose of restructuring credit facilities. Complainants will be able to submit the relevant applications either manually to the Agency, by post, fax, email, or electronically through the website. Applications must be accompanied by proof of payment for €20.
What does the new NPL legislation provide?
According to the new legal framework, the Financial Ombudsman has the possibility to appoint an intermediary, for the purpose of restructuring credit facilities, for terminated loans (for a period of six months from the publication of the law) or for as long as legal proceedings are ongoing.
The Court will issue an order of postponement and at the same time a decree suspending the sale for a maximum period of 4 months. In order to be eligible, the initial amount of the loan must be up to €350,000 and have as a mortgage the main residence worth up to €350,000 or business premises worth up to €750,000. In addition, an intermediary will be appointed for loans in arrears to restructure them, while creditors will not take mortgage properties under the hammer or send borrowers to court. At the same time, in the case of foreclosures and debt verification, borrowers, upon receipt of the letter for auction from banks or credit acquiring companies, within 21 days will be able to submit a fully completed complaint to the Financial Commissioner.
During the examination of the complaint, creditors should stay the sale process until 45 days or 10 days have elapsed from the date of the Commissioner's decision. In relation to the verification of the debt, the decision by the Commissioner will be issued within 45 days and will concern debtors with a mortgage on the main residence worth €350,000. In addition, eligible debtors will be able to apply to the Special Court for the notice to be set aside
