The bills which have recently been passed by the House of Representatives
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In the text below, reference is made to the bills voted by the House of Representatives regarding the protection of the borrowers and the mortgagors.
On 8/12/2023 the House of Representatives voted in favour of five proposed bills which mainly deal with the following matters:
The President of the District Court may appoint, with the approval of the Supreme Court, a number of judges in order to adjudicate cases concerning disputes between the borrower and the creditor, in relation to a credit facility secured by a primary residence, that do not exceed the total value of €350.000. More specifically, if there are such cases pending before the Court and the hearing has not yet commenced those cases will adjudicate before judges who are designated for this purpose.
The powers of the Financial Ombudsman are strengthened to the extent that he can appoint a mediator for restructuring purposes of a credit facility and find an out of court solution for disputes between mortgagor and mortgagee within 45 days. More specifically, the Financial Ombudsman will mediate in cases where a credit facility is secured by a primary residence of up to €350.000 or in the case of commercial properties of up to €750.000.
The eligible debtor is given the opportunity to file a complaint to the Financial Ombudsman against a Bank in relation to his primary residence and if the Financial Ombudsman supports his view, then the foreclosure process will be suspended until he is vindicated by the Court.
The expansion of the term "restructuring" to include the disposal and transfer of an immovable property to the Cyprus Asset Management Company Ltd in the framework of the implementation of the "Rent Against Installment" scheme.
The amendment of the relevant terms and definitions of the Transfer and Mortgage of Property Law, in order to safeguard the rights of the mortgagor with a primary residence.
The abovementioned reforms aim to protect borrowers from foreclosure and the disposal of their properties and their purpose is to find an out of court solution without the need to apply to the Court or to proceed with foreclosure.
By Margarita Avraam
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