The state and, consecutively, taxpayers are expected to pay around €800 million for the Estia scheme by 2044. Implementation of the scheme is set to start in 2019. Calculations are made for a period of 25 years due to the fact that the scheme extends the loan repayment period up to 25 years depending on the borrower’s age.
The project manager of Estia will be the Cyprus Land Development Organisation, through which one-third of the remaining loan installment of each borrower will be subsidised. The state’s annual contribution to the scheme will be €33 million. The Finance Ministry has stated that the government’s fiscal capacity ensures that all expenses towards Estia will be covered.
In a response to questions from MPs during a meeting of the House Finance Committee, the Finance Ministry issued a statement clarifying that an important parameter in the restructuring of loans eligible under Estia will be the value of mortgaged principal residence. The loans shall be restructured to an amount equal to the lower between two sums: either the loan balance on the date of the restructuring, or the estimated market value of principal residence.
