Swiss Franc Loans Relief: Debt Cut, Fixed Interest, and Up to 5-Year Repayment Extension

The Greek government has announced a historic relief measure for Swiss franc loans, targeting approximately 50,000 borrowers who have been financially strained due to the franc’s appreciation. The new legislation provides for conversion to euros at a fixed interest rate, debt reduction of up to 50%, and repayment extensions of up to five years, significantly reducing monthly burdens for households.

Key Provisions of the Measure:

1. Conversion to euros with a fixed low interest rate
   • All outstanding obligations in Swiss francs will be converted to euros, with a fixed interest rate to shield borrowers from currency fluctuations.
   • This measure reduces uncertainty and allows for more predictable financial planning.
2. Debt reduction from 15% to 50%
   • The exact reduction will depend on borrowers’ asset levels, prioritizing relief for the most financially vulnerable.
   • The government describes this as necessary to protect social cohesion and prevent over-indebtedness that could paralyze households.
3. Repayment extension of up to five years
   • Borrowers will have the option to extend their loans by up to five years, lowering monthly obligations and enabling more manageable repayment schedules.
   • This option provides breathing space for those at risk of default or foreclosure.

Prime Minister’s Statement:

Kyriakos Mitsotakis said the measure “closes yet another chapter from the past that has held 50,000 borrowers hostage.” He announced that the legislation would be submitted to Parliament in the coming days to take immediate effect, offering tangible relief to households and families affected by Swiss franc loans.

Economic Impact and Goals:

• Conversion to euros reduces foreign exchange risk for borrowers.
• Debt cuts increase borrowers’ disposable income and stabilize the domestic economy.
• Repayment extensions help prevent defaults and liquidity stress, maintaining financial system stability.

The measure is expected to have a stabilizing effect on the banking sector, lowering non-performing loans and boosting public confidence.

Expert Commentary:Economists note that the government’s approach is a targeted social and economic relief intervention, combining stability, pragmatism, and social justice.

Close monitoring will ensure that the benefits reach those most in need, avoiding inequalities or unfair advantages among borrowers.

Source: pagenews.gr