The landscape of debt settlements is changing, creating a clear dilemma for thousands of debtors: join the out-of-court mechanism now or wait for the new regulation being promoted, which emphasizes protection of the primary residence. The choice directly affects the monthly installment, the size of any debt “write-off,” and—most importantly—what assets are preserved.

The key difference between the two models lies in how the settlement is calculated. In the out-of-court mechanism, the debtor’s entire financial situation is considered. In the new model, the settlement may be based solely on the primary residence.

How the out-of-court mechanism works today

According to the process guide, the debtor submits an application through the platform and consents to lifting banking and tax confidentiality. The system automatically retrieves data from tax authorities, social security, banks, and loan servicers, creating a full picture of debts and assets.

An algorithm then generates a settlement proposal based on total debts, income, deposits, and all real estate assets. This can result in a unified arrangement with up to 240 installments for public debts, long-term repayment for loans, and possible write-offs—mainly of surcharges but sometimes also of principal, depending on financial capacity.

The main advantage is immediate activation and quick protection from seizures and enforcement measures, as long as the agreement is followed. It also allows all debts (to the state and banks) to be handled together with many installments.

However, the main drawback is that all assets are taken into account. This can lead to higher monthly payments for those who own property, smaller write-offs, and no flexibility in choosing which assets to keep.

How the new model changes things

The new regulation being promoted introduces a different approach. Debtors will be able to choose to save their primary residence, with the settlement calculated only on its value and their income—without considering other properties.

The property value will be determined based on the higher of market value or taxable (ENFIA) value. This can lead to lower monthly payments and, in many cases, larger write-offs—especially when there is a big gap between property value and total debt.

However, this comes with a condition: other properties must be liquidated through electronic auctions as part of the restructuring agreement.

The advantage is lower monthly burden, potentially bigger debt reductions, and a more realistic repayment plan while securing the main home. The downside is the loss of other assets and the need to commit to this strategy. It also requires waiting until the framework is fully implemented.

Who should act now

The out-of-court mechanism is more suitable for:

• Debtors without significant assets
• Those who own only one home or limited property
• Cases facing immediate enforcement measures (seizures, auctions)

For example, someone with €60,000 debt and no real estate can benefit from many installments and write-offs, with little to gain from waiting.

Who should wait

The new regulation favors:

• Debtors with multiple properties
• Those whose assets inflate payments under the current system
• People with low liquidity but high property value
• Those not facing immediate enforcement risk

For instance, someone with a primary residence worth €100,000, total debts of €200,000, and additional properties would face high payments under the current system. Under the new model, the calculation would focus only on the main home, reducing payments and increasing write-offs—at the cost of selling the other properties.

The key decision point

Both options require full financial transparency. The difference lies in how that information is used: a comprehensive evaluation in the current system versus a targeted, home-focused approach in the new one.

In practice, the out-of-court mechanism is a tool for immediate relief, while the new regulation is shaping up as a more tailored solution for those with assets and the ability to wait. The real question becomes not just how to settle debts—but which assets are worth saving, and under what terms.