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Cyprus

Refugees seeking loans left in the lurch

Some two-and-a-half thousand refugees eligible for interest-rate subsidies on loans from the Central Agency for Equal Distribution of Burdens (Caedb) have been left in the lurch because they cannot obtain loan approval from the banks in the first place, the House refugees committee heard on Tuesday.

A public-law entity established in 1995, the agency operates the scheme “for the restoration of the pre-war solvency of owners whose immovable property in Cyprus is in the occupied areas. Through the scheme, loans and guarantees for loans are granted to entitled persons for specific purposes.”

But under a provision contained in the bailout deal between Cyprus and its international lenders, the policy of granting guarantees for housing and business loans through the agency was terminated as of January 1, 2013.

Applicants must therefore consult any financial institution of their choice and if they succeed in a loan approval, their application to the Caedb will be handled through the scheme for the subsidisation of interest rate of housing or business loans, with no guarantees from the agency.

Overseas Cypriots are not covered by the scheme unless they have been repatriated to Cyprus and have become permanent residents.

According to the Caedb’s website, “the amount of a loan advanced or of a loan guarantee or subsidisation of interest rate for housing and business loans can amount in total either up to the sum which represents 80 per cent of the value of the occupied or inaccessible immovable property of the owner at current prices or to the sum of up to €85,000, whichever of these two amounts will be the lowest.”

Speaking in parliament, Disy MP Onoufrios Koulla said that according to the agency’s own data, the Caedb has since 1996 advanced loans worth €1.8 billion and granted interest-rate subsidies worth €665 million.

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