New prospects for thousands of over-indebted household cases are created by decision No. 6/2026 of the Plenary of the Supreme Court. The highest court, examining a preliminary question submitted by the former Magistrate’s Court of Ioannina regarding the method of calculating interest in primary residence protection arrangements under Law 3869/2010 (Katselis Law), adopted an interpretation favorable to borrowers.
The Plenary ruled, by majority, that the interest rate provided for in Article 9 paragraph 2 of the law should not be calculated on the total capital of the debt from the beginning of the arrangement, but on each monthly installment at the time of its payment.
In the reasoning of the decision, it is noted that this interpretation corresponds to the basic purpose of Law 3869/2010, which was established to address the serious social and economic consequences of over-indebtedness of individuals. According to the Supreme Court, the law aims at the economic reintegration of debtors and the restoration of their purchasing power, serving broader public interest.
The Supreme Court judges note that the opposite version, namely the calculation of interest on the total capital of the debt, would essentially lead to the creation of a new loan scheme, significantly burdening borrowers. As stated, such an approach could re-trap debtors in excessive installments, disproportionate to their financial capabilities, undermining the protective character of the law.
At the same time, the Plenary emphasizes that this specific interpretation does not affect the rights of creditors nor the protection of their property, as enshrined in the Constitution and the European Convention on Human Rights. As noted, legal interest continues to be owed and paid, without changing the amount of the interest rate, while the decision concerns exclusively the calculation basis.
Supreme Court: How interest calculation will be done
Regarding the time period for interest calculation, the court distinguished between cases of fixed and variable interest rates. In cases of variable interest rates, the calculation will be done for each month separately, according to the changes in relevant reference interest rates. Conversely, when the judicial decision provides for a fixed interest rate, this will be calculated on the determined monthly installment for the entire duration of the arrangement.
After answering the preliminary questions, the Plenary referred the case to the Single-Member Court of First Instance of Ioannina, in order to complete its trial based on the interpretive guidelines given by the Supreme Court.
The decision was not unanimous. Twelve members of the Plenary were in the minority, arguing that the preliminary question should be rejected as inadmissible, since, in their view, it indirectly attempted to interpret the law and re-examine an already issued judicial decision. According to the minority, the operative part of the Ioannina Magistrate’s Court decision was absolutely clear and did not create doubts regarding the method of calculating the interest rate.
Full Supreme Court decision (Click here)
