A significant new option is now available under the Out-of-Court Debt Restructuring Mechanism to individuals who own more than one property. In particular, debtors may choose to retain their primary residence while consenting to the liquidation of other real estate assets, such as a holiday home, a plot of land or agricultural property.
This new option became fully operational on 21 September 2026 through the electronic platform of the General Secretariat for the Financial Sector and Private Debt Management and provides an additional alternative for debtors seeking a sustainable debt restructuring solution without putting their primary residence at risk.
Retaining the Primary Residence and Liquidating Other Real Estate Assets
Under the new framework, when submitting an application, debtors may request that their primary residence be excluded from liquidation, while at the same time consenting to the sale of other properties they own.
This option may have a significant impact on the terms of the proposed restructuring arrangement. The liquidation of other real estate assets may reduce the amount of debt remaining to be restructured and, consequently, result in lower monthly instalments.
It therefore constitutes an alternative to retaining the entirety of one’s real estate portfolio while restructuring a larger portion of the debt over a longer period. Debtors may now assess whether it is more appropriate for them to retain all of their properties or to protect specifically their primary residence while allowing other real estate assets to be liquidated.
Under What Conditions Is the Primary Residence Protected?
When submitting the application through the electronic platform, the debtor declares their intention to retain their primary residence. This property is treated separately from the debtor’s other real estate assets and is taken into account in determining the restructuring proposal.
If the proposal is accepted and the relevant restructuring agreement is concluded, the creditors bound by that agreement may not, for as long as the debtor complies with its terms, initiate enforcement proceedings against the primary residence that has been excluded from liquidation.
However, this protection is neither absolute nor independent of compliance with the restructuring agreement. If the debtor ceases to comply with the agreed repayment terms, they may lose the protection afforded under the arrangement. Furthermore, the agreement is binding upon the creditors covered by it and does not automatically extend to claims held by third parties that fall outside the specific restructuring arrangement.
Who Can Benefit from the New Option?
This option is available to individuals, rather than companies, and is particularly relevant to debtors who own more than one property. It may be used both by private individuals with overdue bank or other debts and by self-employed persons and professionals whose debts arise from their business activities.
Special provision is also made for debtors who had previously entered the Out-of-Court Debt Restructuring Mechanism but subsequently lost their arrangement, including due to an inability to meet the required instalments. In such cases, a new application may be submitted within six months from the entry into force of the new framework.
The mechanism may also be available, subject to specific conditions, to individuals who had previously applied for relief under Law 3869/2010 (the so-called “Katseli Law”), provided that there are no longer any pending court proceedings in relation to their application.
What Applies to Debtors Whose Only Property Is Their Primary Residence?
The new option concerns debtors who own more than one property. Those whose primary residence is their only real estate asset may continue to make use of the standard Out-of-Court Debt Restructuring Mechanism, which provides for long-term repayment arrangements of up to 240 instalments for debts owed to the State and up to 420 instalments for debts owed to banks and other financial institutions.
At the same time, access to the mechanism has been broadened, as applications may now be submitted for total debts of €5,000 or more.
An Additional Option Requiring an Individual Assessment
The possibility of retaining the primary residence while simultaneously liquidating other properties expands the range of solutions available for the restructuring of private debt. However, it is not necessarily the most appropriate solution for every debtor.
Before opting for this procedure, a comprehensive assessment should be made of the amount and nature of the debts, the value of and any encumbrances over each property, the composition of the debtor’s assets, the creditors involved, as well as the debtor’s actual ability to meet the proposed repayment instalments in the long term.
Proper preparation of the application and prior assessment of the available options are therefore crucial in ensuring that the solution selected reflects the actual financial circumstances and asset position of each individual case.
If you wish to explore your eligibility for the Out-of-Court Debt Restructuring Mechanism and assess which solution is best suited to the circumstances of your case, please contact our law firm at info@makrispartners.com or +30 210 364 4677.
Georgia Patsidou / Attorney at Law – Junior Partner
georgia@makrispartners.com
