The Transfer and Mortgage of Property (Amended) (No. 4) Law of 2022 (the Bill) was adopted in Parliament on 14.07.2022 in order to reinstate the targeted suspension of the foreclosure process until the 31st October 2022. The reason behind the suspension of the process of sale of mortgaged properties is due to the ongoing and intensifying impact of Ukrainian war, as well as the COVID-19 pandemic, have induced on both the economic and social effects.
The Bill amends article 62 which stipulates that the application of the provisions of Part VIA of the Transfer and Mortgage of Property Law N. 9/1965 regarding the sale of mortgaged properties is temporarily suspended and more specifically until 31st of October 2022 in three types of real property, as explained in further detail below.
Firstly, the temporary suspension of the foreclosure process will apply to the primary residence of the debtors that do not exceed the total value of €350.000. Secondly, it will also apply to all debtor’s commercial properties where their annual turnover does not exceed a total of €750.000. Lastly, this suspension will also apply to every debtor’s agricultural land whose estimated value does not exceed €100.000.
The above temporary amendments in law have already taken effect and a lot of criticism took place between members of Parliament mentioning, amongst others, that this temporary suspension will provide a safety net to all borrowers that suffer from the abusive behaviour of the Banks and the Credit Acquisition Companies, given the already harsh economic and social circumstances that they are exposed to with the current crisis. On the contrary, arguments were also presented by the other majority of members of Parliament supporting the other side of the coin, by stating that this behaviour supports and promotes the malicious acts of loan defaulters, by abusing and taking advantage of the insufficient and extremely slow system followed in Cyprus; Overall, the Bill will stay in effect until the 31st October 2022, and afterwards new discussions will take place to ensure a better and fairer system for everyone.