Cyprus –Immovable Property
‘Parliament to submit law addressing the issue of Title Deeds and Hidden Mortgages’
One of the major problems that Cyprus faces throughout the years is the inability of property buyers to obtain Title Deeds as a result of developers who have previously mortgaged the land on which the property was built. Eurogroup has called on Cyprus to tackle this problem which will ensure that Title Deeds will be delivered to the buyers without any delay. Troika has decided to tighten screws on Cyprus property and has stated that it will not release the seventh tranche of the bailout loan until property buyers in Cyprus have their title deeds transferred within six months.
In particular the latest Memorandum of Understanding dated 18th June 2015 stated that prior to the granting of the seventh disbursement of financial assistance, the authorities will need to present legislation that will ensure that property buyers who have paid the purchase price in full, will have their title deeds transferred within six months after their issuance. The aim of such legislation is to tackle the problem surrounding the delay in issuance of Title Deeds.
The actions of the Cypriot Government has improved in recent months where on the 24th June 2015 the Interior Minister Socratis Hasikos has announced that the Council of Ministers has approved the hidden mortgages bill but has postponed discussion of such a bill until the third of September 2015.
The main provisions of the hidden mortgages bill are as follows:
- For the purpose of issuing ownership titles to the benefit of the buyer, authority is granted to the director of the Land Registry Department to exempt, eliminate, transfer, cancel mortgages and or other encumbrances, depending on the case and under certain conditions.
- The sale price must have been paid in full by the buyer. In case of an outstanding amount, the buyer can deposit it in a special temporary account managed by the land registry director.
- The director will have the power to transfer mortgages to other property belonging to the seller. If no such property is available, the director can transfer the encumbrances on individuals who guaranteed the seller’s obligations and, at the time the agreement was signed, had acted as board members, or owned over 10 per cent of the seller’s share capital.
To benefit from these provisions a sales contract for the property or part thereof, must have been submitted to the land registry department by December 31, 2014.
For further information on this topic please contact
Miss Nada Starovlah (nstarovlah@pittaslegal.com) at SOTERIS PITTAS & CO LLC,
by telephone (+357 25 028460) or by fax (+357 25 028461)
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