THERE IS NOT PROTECTION FOR THE PRIMARY RESIDENCE

28 Mar 2019 -- Posted by : admin

The reality that thousands of "red" borrowers experience today because they have not been subject to the Katseli law to protect their primary residence, is expected to be experiencedby even more debtors from the beginning of 2019 since its term expires. From 1-1-2019 and if there is no extension of the deadline for submission to the Katseli law, borrowers will have no choice but to settle their loan either with an out of court agreement or through the Banking Code of Conduct (which is also an out-of-court settlement). In case the loan is terminated, then the entire amount becomes chargeable and a payment order is issued and the process of compulsory seizure begins.

In more detail:

Step 1: The non-payment of the due instalment (usually three instalments) gives the right to the bank to proceed with a unilateral termination of the loan agreement or credit card agreement, by sending an extra-judicial notice with a court enforcement officer. The loan service account will become late arrears, leading to the total amount of the debt to become chargeable.

Step 2: After the termination of the contract, the bank has the possibility to issue a payment order, achieving this way to obtain an instrument authorising enforcement against its debtor and guarantor. The payment order is an instrument authorising enforcement, based on which compulsory seizure may be carried out, ie seizure and auction. The payment order is an instrumentproviding the possibility to register a mortgage and if there is already a pre-notice of mortgage to secure a claim for which a payment order has been issued, the pre-notice is converted into a mortgage. In addition, the debtor should be aware that the issuance of a payment order against him entails his registration in the file of Tiresias, where the adverse financial data are kept.

What the borrower can do: In the event that the debtor has been served with a payment order, he may file a notice of opposition against the proceedings within 15 calendar days, as well as a request for suspension of execution, in order to prevent any further action by the bank and especially the seizure and auction of his property.

Step 3: If the debtor does not file a notice of opposition, the request for suspension of execution or the notice of opposition are rejected, then the bank can seize the property of the debtor against whom the execution is directed in order to auction the confiscated item. The first bid price for the real estate auction is its commercial value, as determined at the time of the seizure.

What the borrower can do: A copy of the seizure report is served by a court enforcement officer. The debtor may challenge it by filling a notice of opposition within 45 calendar days. In the event that this has errors, in particular regarding the description of the confiscated item, the estimate and the price of the first offer, the debtor has the opportunity to file a notice of opposition no later than 20 working days before the day of the auction.

Step 4: The main part of the compulsory seizure procedure after the confiscation is the sale of these items through auction. The auction cannot take place earlier than seven months and later than eight months after the completion of the seizure procedure. On the day of the auction, the interested parties submit their bids to the auctioneer in a sealed envelope. The auction starts with the first bid that has been specified in the seizure report.

In the electronic auction, candidate buyers, who have been previously certified by the electronic auction systems, participate. Each bidder declares his participation in a specific auction, in accordance with its terms, after having paid the required guarantee and the fee of the system usage, and has submitted an electronic power of attorney by 15.00, two working days before the appointed day of the auction.

Then, by 17.00 of the day prior to the electronic auction, the officer of the electronic auction checks the submitted files, identifies whether the formalities are followed, and submits to the electronic auction systems a list of eligible bidders. The auction is carried out under the supervision of a notary on Wednesday or Thursday or Friday, from 10.00 to 14.00 or from 14.00 to 18.00, while it cannot take place from August 1st to August 31st, as well as the prior and following week from any election day.

What the borrower can do: The debtor can challenge the auction process within 30 calendar days from the registration of the auction report if it concerns a movable item or within 60 days if it concerns real estate property.

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