The agreement for the €100 million contribution by Greece’s systemic banks to the Property Acquisition and Leaseback Agency is expected to be signed by 16 November. The deal will pave the way for the completion of the tender process and offer a new lifeline to vulnerable borrowers at risk of losing their primary residences. The Agency will purchase the property and lease it back to the same household for 12 years, with a state subsidy and the right to repurchase it even before the tenancy expires.

The preferred bidder, Christofferson, Robb & Co, has written to the Ministry of National Economy and Finance requesting a few additional days to finalise the agreement with the banks. The company cited the complexity of the transaction and reaffirmed its commitment to proceeding with the project.

According to sources familiar with the process, the aim remains to complete the final contract award, the review by the Court of Audit, the signing of the concession agreement with the Greek state and its ratification by Parliament by January 2027. The Agency is expected to begin operating immediately afterwards.

How the rent will be calculated

The Agency will acquire the vulnerable debtor’s ownership interest in their primary residence, generally paying 70% of its market value, as determined by a certified valuer. Where the transfer takes place as part of enforcement proceedings, payment of the purchase price will result in the cancellation of the property auction.

The rent for the first year will be calculated on the basis of the average interest rate on variable-rate mortgages published by the Bank of Greece for the latest available month, the additional margin offered by the investor and the value of the ownership interest acquired by the Agency. The rent will be adjusted annually on the anniversary of the lease agreement.

The state subsidy will range from €70 to €210 per month, depending on household composition and the applicable eligibility criteria. The tenant will be responsible for paying the remaining rent.

When borrowers can buy back their homes

Tenants will be able to repurchase their homes even before the 12-year period expires, provided they have kept up with their rent payments and can afford the purchase price. Early repurchase will not require them to pay rent for the remaining years of the lease. The buyback price will take into account the amount originally paid by the Agency and the market value of the ownership interest at the time of repurchase.

If three rent payments remain outstanding and the tenant fails to settle the debt within one month of receiving formal notice, the lease will be terminated and the right to repurchase the property will be lost.

Who is eligible and how to apply

The scheme is intended for debtors who have been declared bankrupt or are facing enforcement proceedings against their primary residence by a creditor holding a mortgage or other registered security interest. Applicants must obtain a vulnerable debtor certificate, which is issued electronically through the gov.gr portal.

Applications to the Agency will be submitted through a dedicated online platform and must include identification details, property ownership documents, the vulnerable debtor certificate and either the seizure notice or details of the bankruptcy ruling. The standard application deadline is 60 calendar days from the date of the seizure notice or publication of the bankruptcy decision. During the first six months after the Agency is established, an exemption from this deadline will apply, provided that the property auction has not been scheduled within the two months following the application or, in bankruptcy cases, the ownership interest remains part of the bankruptcy estate.

The debtor must consent to a property inspection by a certified valuer appointed by the Agency. Where there are co-owners, their participation and consent will also be required. Refusal to allow the inspection, or the discovery of legal or regulatory breaches that prevent the transfer of ownership, may result in the application being rejected.

What applies until the Agency becomes operational

Until the Agency begins operating, the Interim Support Programme for Vulnerable Debtors will remain available. Eligible participants benefit from a suspension of enforcement proceedings against their primary residence and a state contribution of €70 to €210 per month towards their mortgage repayments.

Income and property thresholds

For single-parent families, the income threshold increases by €3,500 for the first minor child. This means that a single parent with one minor child is subject to an annual income ceiling of €14,000.

For the special category of vulnerable debtors with a certified disability of at least 67%, the thresholds can reach €42,000 in annual income and €360,000 in the taxable value of real estate assets, depending on household composition.