House rejects president’s veto of foreclosures’ freeze

Parliament on Friday rejected President Nicos Anastasiades motion to recall a bill putting a freeze on foreclosures until January 2023.

The presidential veto was rejected with by 37 MPs, while 15 MPs voted in favour.

Now, the question is whether Anastasiades will defer to the supreme court.

The moratorium on foreclosures applies to a debtor’s primary residence valued at €350,000 or less, business premises where the business’ annual turnover does not exceed €750,000, and parcels of land with a value of €100,000 or less.

Depa MP, Alecos Tryfonides said their party had proposed solutions, but unfortunately, they were not feasible, such as the adoption of the mediation proposal presented by the Financial Ombudsman Pavlos Ioannou for targeted suspension of foreclosures.

“But this is not a solution, we constantly make suspensions, and we don’t really go to see where the problem is. It’s the last time and we have a responsibility after the presidential elections to do this because we don’t want to come to this point again,” he said.

On November 10, the extension – the latest in a series since 2021 – was passed and will apply until the end of January 2023.

The bill passed with 32 votes for, 12 against. All MPs bar those from ruling Disy were in favour.

Both the government and the Central Bank had warned against a new freeze on repossessions, saying it would undermine the island’s foreclosures framework and jeopardise the country’s sovereign credit rating.

They also cautioned it would encourage strategic defaulters and lead to an increase in the stock of non-performing loans, forcing banks to raise their capital provisions.

According to media reports, during the horsetrading and lobbying preceding the vote in the House, the association of credit management companies sent a letter to MPs promising to desist until the end of February on foreclosing on any properties worth up to €350,000 belonging to individuals and households classed as financially vulnerable.