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Eurofound's EU PolicyWatch collates information on the responses of government and social partners to the COVID-19 crisis, the war in Ukraine, rising inflation, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.

Factsheet for measure BE-2022-39/2816 – measures in Belgium

Mortgage loan deferral for people in financial distress

Uitstel van terugbetaling hypothecaire lening

Country Belgium , applies nationwide
Time period Open ended, started on 19 September 2022
Context War in Ukraine
Type Other initiatives or policies
Category Responses to inflation
– Increasing income in general
Author Dries Van Herreweghe (Katholieke Universiteit Leuven) and Eurofound
Measure added 09 September 2022 (updated 20 September 2022)

Background information

Given the increasing cost of living and the continuous reporting of households being affected by the ongoing crisis, the sectoral federation/employers' association Febelfin (Belgische Federatie van de Financiële Sector – Fédération belge du Secteur Financier – Belgian Financial sector Federation) has announced that it has discussed with their members (banks and other financial institutions) about possible measures to relieve financial pressure on citizens in need.

Concretely, under specific circumstances, people that are in financial hardship are allowed to postpone the repayment of their mortgage (aside from the interest). This in order to temporarily save a part of their budget to cope with rising costs.

Content of measure

The deferral of repayment can last for a period of up to 12 months. The term of the loan is extended by the number of months of postponement. Additionally, the banks will not charge any file or administrative fees for the extension.

In 2020 and 2021, private individuals were also allowed to temporarily postpone paying capital repayments and interest on their mortgage loans if they got into financial difficulties due to the corona crisis.

However, there are relatively strict conditions for the deferral that must be met in order to benefit from it.

  • The person applying has to have a residence in Belgium.
  • On 1 March 2022, the person was not in arrears with the Central Individual Credit Register. Concretely, at the time of the request of the deferment, the person can have no more than €10,000 in bank assets (current, savings and securities accounts) at any bank. Pension savings are not taken into account.
  • Another important condition is that the person has an instalment plan running or requested from their energy supplier.

The measure applies to citizens and households, Febelfin and the banks opt for more individualized solutions for enterprises in need.

Use of measure

The uptake of the measure is not estimated or predicted. However, some organisations as well as ministers believe the conditions are too strict for many to make use of the measure.

Target groups

Workers Businesses Citizens
Does not apply to workers Does not apply to businesses People on low incomes

Actors and funding

Actors Funding
Employers' organisations
Company / Companies
No special funding required

Social partners

Social partners' role in designing the measure and form of involvement:

Trade unions Employers' organisations
Role Unknown Agreed (outcome) incl. social partner initiative
Form Not applicable Direct consultation outside a formal body

Social partners' role in the implementation, monitoring and assessment phase:

  • Only employers' organisations
  • Main level of involvement: Sectoral or branch level

Involvement

Febelfin has discussed and organised the measure together with their members, they are the employers organisation of the banking sector.

Views and reactions

Febelfin believes the measure will alleviate pressure on households in a precarious financial situation.

Sectors and occupations

    • Economic area Sector (NACE level 2)
      K - Financial And Insurance Activities K64 Financial service activities, except insurance and pension funding

This case is not occupation-specific.

Sources

  • 08 September 2022: Gezinnen in geldnood kunnen één jaar lang alleen intrest op woonkrediet aflossen (www.standaard.be)

Citation

Eurofound (2022), Mortgage loan deferral for people in financial distress, measure BE-2022-39/2816 (measures in Belgium), EU PolicyWatch, Dublin, https://static.eurofound.europa.eu/covid19db/cases/BE-2022-39_2816.html

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Disclaimer: This information has not been subject to the full Eurofound evaluation, editorial and publication process.