Slovakia's government approved this month a proposal to prepare necessary law in order to assists citizens, who can't pay off mortgages because of the economic crisis.

The programme will be implemented in cooperation with The Slovak Banking Association (SBA) and will consist of two stages.

'The first stage will deal with assistance by a bank in the form of restructuring of the housing loan,' states the Finance Ministry. 'State aid will follow in the second stage and will consist of providing assistance in repaying instalments of the restructured loan for a certain time.'

The SBA expects about 1,000 defaulted loans per 10,000 newly unemployed citizens. The volume of state aid for this amount of defaulted loans is estimated at about €2.8 million.

The state help is designed for people, who are unable to pay off mortgages signed before 31 December 2008 because they lost their jobs thanks to the crisis and have no other properties.

It is expected that the programme will start at the beginning of October.