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First five debt relief orders

The Insolvency Service announced on Friday the issuance of the first five debt relief orders, for debts up to €25,000 following a number of applications it made to the Limassol District Court.

debt relief ordersTHE INSOLVENCY SERVICE announced Friday the issuance of the first five debt relief orders, for loans up to €25,000.

The District Court of Limassol issued the first five decisions from a total of 40 applications filed last week by the Insolvency Service to the court. The average amount per case was €18,000.

A total of 673 applications were filed to the Service for debt relief which, according to the Head of the Insolvency Service George Karotsakis seems to meet the criteria. However, he said, investigations will be conducted to ensure that the criteria are fully met.

Karotsakis said at a press conference that the aim of the Service, is all cases to be registered in the court until next October. He also said that it was positive that so far no application filed by the Insolvency Service has been rejected. As he explained, many young unemployed people who have student loans benefit from the debt relief orders.

Individuals with assets below €1,000 and monthly income below €200 may apply to the court via the government Insolvency Service for an order for debt relief of up to €25,000. The eligible individuals are also allowed to have a car up to €4,000, tools for a small business up to €6,000 euro as well as furniture and utensils for their family.

At the same time Karotsakis said that last week four applications were filed in the court, regarding personal repayment plans aiming, inter alia, to protect the borrowers’ main residence. The Service has received so for 26 applications for personal repayment plans. Karotsakis urged people to use these tools, saying that Cyprus insolvency framework ranks 17th in World`s Bank ranking.

Head of the Insolvency Service also said that a State plan for the protection of the main residence that subsidizes loan instalments up to 60%, without exceeding €10,000 per year, is on track and is expected to be approved in the next two months from the European institutions responsible for competition policy.

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