Thanks for your patience and enquiry.
This does not at all seem to be a very straightforward situation to be in to say the least. I must be candid with you in saying that as his parents were guarantors for the loan, they could, in theory, pursue his mother for the unpaid loan. They would however first need to have an order from the court allowing them to take anything from your mother prior to being able to do so. I would not therefore worry too much about this, as such an application could be challenged.
If the property is still there in Crete why hasn't he sold it to satisfy the debt?
He could however, challenge being ordered to pay in full. The bank is just using this tactic to see whether he could be forced into paying all this money. It is not unheard of for a debtor to say to the court I cannot afford the amount being demanded because of their current financial situation. He may then make a proposal as to how much he is able to pay.
My overarching guidance is to not ignore any letters of demands which may be sent. If these are ignored the bank could proceed to court and obtain judgment in default.
Can I clarify anything for you? I hope I have answered your query in a way that is simple and easy to understand. If anything remains unclear, I will be more than happy to clarify it for you. In the meantime, thank you once again for using our services.