Over 70 per cent of housing scheme applications eligible for loans

The Ministry of Finance announced on Thursday that 1,318 applications have been submitted, potentially qualifying for loans totalling €131.1 million under the Oikia housing scheme.

This scheme was designed to help manage the loans involving government funds granted under government housing schemes.

The ministry’s announcement stated that 199 loans, approximately 14.25 per cent, are ineligible, while 946 loans, approximately 70.40 per cent, are eligible.

Meanwhile, 173 loans, approximately 15.35 per cent, are awaiting eligibility assessment.

On February 18, 2022, the European Commission approved the extension of the plan until June 30, 2022, for application submission, and April 30, 2023, for the implementation of solutions.

The income criteria of the Oikia scheme have also been modified. The European Commission approved a new extension of the completion of the Oikia scheme until December 31, 2023, on March 3, 2022.

Regarding the new extension for the implementation of solutions, in terms of managing the loans involved, the Ministry of Finance stated that the Housing Financing Corporation (HFC) should evaluate the applications and send them for approval to the Treasury of the Republic of Cyprus by June 30, 2023.

It added that the approval process, whether completed or not by the Treasury, should be completed by September 30, 2023, and the implementation of solutions by December 31, 2023.

Furthermore, the Ministry of Finance stated that applicants deemed eligible based on the Oikia scheme criteria, but assessed as unsustainable, will have the right to be included in the Rent-for-Installment scheme when the scheme is finally approved by the European Commission.

According to the Ministry of Finance, the purpose of the Oikia scheme is to assist first-time borrowers who have taken out loans with government funds, meaning low-income couples who used the government’s housing loan scheme, with a mortgage on their first home.

This can be achieved through the Unified Housing Scheme or with co-financed funds. The loans may have also been granted by banks under specific conditions, such as the construction of a residence on government land, Turkish Cypriot land, or in an area under the sovereignty of the British state.

The loans must also have been overdue for more than 90 days on December 31, 2019.

The beneficiaries of these loans, according to the rules of the scheme, have the opportunity to settle the balance of their loans through either restructuring the remaining capital of the loan within the framework of a feasible and sustainable solution or by full and immediate repayment of the remaining capital.

The remaining capital refers to the amount issued based on the original approval plus the charges for life and fire insurance, excluding the repayments of the borrower using their own resources, until the date of the loan’s adjustment or repayment based on the scheme’s criteria.