InsiderEconomyConstant supervision for ‘Estia’ scheme beneficiaries

Constant supervision for ‘Estia’ scheme beneficiaries

Cabinet this week is expected to approve both the Memorandum of Understanding as well as all provisions of the revised ‘Estia’ scheme which is expected to assist the repayment of primary home loans that were not serviced at the end of September 2017.

The revised scheme includes amendments by the European Commission Directorate General for Competition.

The state will meet one third of the payment for those on the scheme throughout their revised payment plan on the condition that the person who took out the loan will pay the other two thirds.

All applicants to come under ‘Estia’ scheme will be constantly monitored since tax payers’ money is involved. At the same time the Memorandum provides that any breach of agreed terms sparks immediate auction procedures.

Another strict condition of the Memorandum is that the state can have unobstructed access to any data included in the ‘Estia’ application at any time and at whatever financial institution this may be. The lifting of confidentiality provision also applies in cases where additional examination is requested by the special committee set up in accordance with the Memorandum’s terms.

In addition, the Memorandum allows the state to review income criteria and assets of the debtors of restructured home loans so as to determine whether there has been any increase or change in assets in excess of 30% in real terms. Because this could justify the undertaking of the repayment of the restructured loan exclusively by the beneficiary.

At the same time, the state retains the right to verify that all criteria for scheme participation are fulfilled. The state also has the right to appoint independent external consultants who, after carrying out all necessary audit procedures including sample inspections, submit a relevant report.

The Memorandum sets out two conditions under which the state can cancel an ‘Estia’ grant.  The first case concerns debtors of restructured loans who stop paying their instalments, along with the observation at any time that the  beneficiary did not meet the criteria and conditions between the period of September 30, 2017 and the day his/her application was examined. The second case concerns a beneficiary who submitted false information so as to join the scheme.



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