Cyprus Mail
Cyprus Property

Trapped buyers get extension to protection

By unanimous vote, parliament on Thursday passed a law extending to the end of 2022 the protection afforded to ‘trapped’ property buyers.

It means the protection now applies to buyers who filed a sales contract to the land registry pursuant to a court order issued after December 31, 2019, based on an application filed with a court prior to December 31, 2022.

The legislative proposal was tabled by Disy MP Nicos Tornaritis.

In a bid to sort out the so-called trapped property buyers mess, back in 2015 parliament passed a government bill granting the head of the land registry the authority to exempt, eliminate, transfer and cancel mortgages and or other encumbrances, depending on the case and under certain conditions.

The law sought to resolve the problems created by the failure to issue title deeds to people who had paid for their property, either because the property was mortgaged by the developer, or the state could not go ahead with the transfer because of outstanding taxes.

Since developers’ land and buildings were counted as assets that need to be offset against their debt to banks, this gave lenders a claim on people’s properties that had been mortgaged by developers.

But following a string of court decisions in cases where banks objected to the law, the land registry suspended procedures, as authorities contemplated their next move.

In July 2018 banks and the legislature struck a gentlemen’s agreement aiming to resolve the matter. In exchange for MPs approving legislation making it easier for banks to collect their dues, the banks association agreed not to raise any objections over the issue of buyers trapped without title deeds as long as the transaction was done in good faith.

Speaking in parliament on Thursday, Akel deputy Aristos Damianou called on banks and “their bigshot lawyers” to stop hindering the legal rights of trapped buyers.

 

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