The resolution of non-performing loans is never a uniform process. It depends on market maturity, the broader economic environment, liquidity in the real estate sector, and often also on how local court systems and regulatory frameworks function. For investors, this means that loans on the same platform can progress at very different speeds depending on the country.
In this article, we provide a clear overview of how the recovery of non-performing loans is progressing across Estateguru’s different markets. We look at where recoveries have advanced more quickly, where and why processes take longer, and how market conditions, legal frameworks and economic factors influence outcomes.
Since launch, a total of €925+ million has been financed through the Estateguru platform. Of this amount, 77% (€711 million) has already been repaid, generating €95 million in returns for investors.
Estateguru market classification
To provide context, Estateguru’s markets are divided into three categories:
- Active markets, where new loans are issued
- Inactive markets, where no new loans are issued and the focus is solely on recovering the existing portfolio
- Closed markets, where no new loans are issued and all loans have been fully repaid
Today, we actively issue new loans in three countries: Estonia, Latvia and Lithuania.
Since 2023, our focus has been fully on these markets. At the same time, Estateguru obtained a European Crowdfunding Service Provider licence from the Estonian Financial Supervision Authority. From 2023 onwards, a total of €223 million has been invested across the Baltic states, with 97% of loans either fully repaid or performing in line with schedule. This underscores our long-term focus on credit quality and disciplined risk assessment.
The weighted average LTV of loans issued in the Baltics during this three-year period has been 57.8%, and the weighted average interest rate 10.13%.
Our inactive markets are Finland, Germany and Portugal, where we no longer issue new loans and focus exclusively on recovering existing investments.
Our closed markets are Spain and Sweden, where all loans have been fully repaid and currently no new lending takes place.
Loan recoveries: 2025 snapshot
Recovering funds from defaulted borrowers is a core part of Estateguru’s day-to-day work, particularly in inactive and closed markets. To date, we have recovered a total of €63 million in principal for investors, including €14.8 million in 2024 and €7.5 million in 2025. In addition, in 2025 we sold three Lithuanian claims for €5.3 million, with final settlement due in autumn 2026.
These results are the outcome of sustained, hands-on work involving court proceedings, collateral enforcement and close cooperation with local partners.
Recoveries also require a significant financial commitment from Estateguru. Based on last year’s figures, monthly costs related to managing non-performing loans amount to approximately €100,000–150,000, and in 2025 Estateguru invested a total of €1.7 million of its own funds into recovery activities. These costs include legal fees, bailiff expenses, brokerage fees, collateral takeovers, insurance, insolvency asset management and other procedural costs.
Such investments are an unavoidable part of resolving complex cases and are made with a clear objective: to maximise the amount ultimately returned to investors.
This work to protect investors is part of our day-to-day, ongoing operations and often remains out of sight until concrete outcomes are achieved. As a result, it can sometimes create the misleading impression that no progress is being made. To increase transparency, we have introduced quarterly updates for each loan under recovery starting in 2026, highlighting the latest developments. Investors can view these updates directly in their portfolio view on the Estateguru platform.
Market-by-market overview
Estonia
Estonia has so far been Estateguru’s strongest-performing market in terms of loan servicing. The vast majority of loans have either been fully repaid or continue to perform in line with schedule, reflecting both market maturity and a risk assessment approach well adapted to local conditions. For collateral securing non-performing loans, auctions are in most cases either ongoing or already completed. Any delays are mainly due to slow court proceedings and/or legal disputes.
In 2025, the Estonian real estate market remained stable but subdued. Modest economic growth, persistently high inflation and weak consumer confidence weighed on activity. Forecasts for the current year point to gradual economic improvement, which should support buyer confidence, developer activity and demand for non-bank financing.
Latvia
Latvia’s real estate market has been more active than Estonia’s in recent years, particularly in Riga and its surrounding areas. Demand for new and nearly new residential property has remained resilient, while household purchasing power has gradually improved. Higher market liquidity has supported more efficient project completion.
As a result, Estateguru’s volumes in Latvia grew by 12% in 2025, and we continue to see further growth potential.
From a portfolio perspective, most loans have either been repaid or are performing as scheduled. 2025 was a strong year for recoveries, delivering substantial repayments to investors. Recoveries will continue gradually throughout 2026, while the share of non-performing loans in the portfolio continues to decline. Notably, there are currently no active defaults related to loans originated in 2025.
Around half of Latvia’s non-performing loans relate to a single larger project – the Salaspils development (loans LV0650 and LV2357). Work on this case continues, although the borrower has deliberately delayed collateral enforcement. The remaining non-performing projects are largely already for sale or moving in that direction, with no broader systemic delays currently evident.
From a risk management perspective, we have focused on smaller loan sizes and improved diversification, reducing concentration risk. Estateguru’s product is well recognised in Latvia, allowing us to select projects with conservative structures and clear exit strategies.
Macroeconomically, Latvia is moving into a more stable phase, and forecasts suggest that economic growth will accelerate in 2026, supporting both consumer confidence and real estate activity.
Lithuania
Lithuania was the most active Baltic market in 2025, characterised by strong competition for high-quality projects. During the year, €21.3 million was invested through Estateguru, representing approximately 17% growth compared to 2024 and the strongest result of the past three years.
Most loans in the Lithuanian portfolio have either been repaid or continue to perform as scheduled. Non-performing cases are primarily larger-scale projects, often in the €3–5 million range, several of which are already at auction or in active sale processes.
In many cases, delays have been caused by breaches of construction regulations. Under Lithuanian law, collateral cannot be sold until such issues are rectified. Other cases have been extended by disputes related to building permits or planning approvals, including instances of illegal construction. These matters are being resolved, and further collateral realisations are expected within the year.
As positive news for investors, in 2025 we sold three claims in Lithuania with a total value of €5.3 million (loans LT7229, LT2876 and LT4782). The settlement of this transaction is scheduled for autumn 2026, after which the funds will be distributed to investors.
At the same time, market activity and broader macroeconomic trends – including rising wages, easing inflation and a stabilising interest rate environment – point to positive medium-term prospects for the Lithuanian real estate market. Over the past few years, real estate prices in Lithuania have increased by more than 10% overall, with some segments seeing annual price growth of around 10%, particularly in central city areas and old towns.
Portugal
Loans in Portugal continue to be serviced according to schedule, and we expect the remaining portfolio to be fully repaid by the end of the summer. With this, Estateguru will conclude its activities in the Portuguese market.
Finland (inactive market)
Estateguru issued its first loan in Finland in 2018. As volumes remained limited and borrower payment behaviour fell short of expectations, we decided to discontinue operations and redirect our focus. In hindsight, our entry coincided with an unfavourable economic cycle marked by successive shocks, including the war in Ukraine, the energy price surge, high inflation, rapidly rising interest rates, a downturn in construction activity and weakening consumer confidence. In 2024–2025, this was further compounded by slowing economic growth and rising corporate bankruptcies.
The Finnish real estate market has declined over this period, with low liquidity across several asset classes. Supply is high, buyers have ample choice and transaction timelines remain long.
Today, our activities in Finland are limited to recovering previously issued loans. Sales are mainly conducted through bailiffs and insolvency administrators, supported by a real estate broker engaged by Estateguru. Legal proceedings are handled by our local partner, Magnusson Law.
We actively work to preserve – and where possible enhance – collateral value by covering ongoing costs such as utilities, insurance, land taxes and ground lease fees, as well as the proportional share of homeowners’ association debt for residential assets. Where appropriate, we also invest in measures that improve marketability, such as subdividing properties into individual apartments. The objective is to maximise sale proceeds for investors, even if this requires a longer timeframe.
Low market activity, oversupply and a slow, highly bureaucratic enforcement framework remain the main challenges in Finland. Despite lengthy timelines, we continue to progress cases with the aim of achieving collateral sales through court or insolvency proceedings.
Germany (inactive market)
Estateguru was actively operating in Germany between 2020 and 2022. In practice, borrower payment behaviour and developments in the real estate market did not meet our expectations, leading us to discontinue the issuance of new loans in the country. In hindsight, our activity in Germany coincided with a period in which the economic environment deteriorated rapidly. Market conditions were affected by the broader impacts of the war initiated by Russia, changes in Germany’s domestic and immigration policies, the suspension of state accommodation projects, and the effective disappearance of the refinancing market. As a result, many borrowers found themselves in a position where meeting their obligations sustainably was no longer possible.
Germany is now an inactive market, where our sole focus is recovering existing loans. Collateral is sold via bailiffs and insolvency administrators, while in parallel we work to preserve asset value by covering ongoing costs and investing in measures such as construction waste removal where needed.
Recovery timelines are heavily influenced by Germany’s bureaucratic and overburdened legal system. Nearly every step requires court or bailiff involvement, with mandatory waiting periods of four to six months between stages. Paper-based communication, overloaded courts and procedural delays further slow progress, while weak real estate market conditions weigh on pricing and transaction speed.
Capital losses observed in Germany largely reflect a structural shift in the real estate and credit markets, rather than isolated project failures. Many loans were issued in 2021–2022, when interest rates were low and growth expectations optimistic. Today’s conservative credit environment limits buyer demand for distressed assets and makes transaction execution more time-consuming, even where assets remain fundamentally saleable.
This shift away from “extend and pretend” approaches is visible across the market, with distressed assets increasingly resolved through sales, restructurings or insolvency proceedings. The bankruptcy of EV Digital Invest in November 2025 illustrates the broader challenges faced by the sector.
Our focus in Germany remains the systematic and disciplined resolution of non-performing loans. To date, five loans have been fully resolved, with a further three to five expected to reach resolution in the current half-year. In every case, our objective is to maximise recoveries for investors, even in a complex and slow-moving environment.
Spain (inactive market)
All loans issued in Spain have been fully repaid, and the market was closed last year without any capital losses.
In conclusion
The recovery of non-performing loans at Estateguru is a continuous, month-by-month process, not a one-off exercise. Each month, we commit time, expertise and significant own funds to move cases forward – through legal proceedings, collateral management, sale preparation and close cooperation with local partners.
While the pace and challenges vary by market, our focus remains the same everywhere: to maximise the amount ultimately returned to investors from non-performing loans, and to do so transparently and consistently, even when resolutions take time.
