On Thursday, Parliament unanimously passed legislation extending the protections for fraudulent property buyers until the end of 2022.
This means that protection now extends to buyers who have submitted a sales contract to the land registry under the following conditions:
- pursuant to a court order issued after December 31, 2019,
- on the basis of an application filed with the court before December 31, 2022.
The legislative proposal was presented by Disy MP Nikos Tornaritis.
In an attempt to resolve confusion with trapped property buyers, Parliament passed a bill back in 2015. It gave the head of the land registry the power to release, remove, transfer and cancel mortgages and/or other encumbrances as the case may be.
The law sought to address the problems that arose from not issuing title deeds to people who had paid for their property. The main reasons for non-delivery are as follows: the property was mortgaged by the developer or the state could not make the transfer due to unpaid taxes.
Developers’ land and buildings were considered assets to be offset against their debt to banks. This gave creditors the right to claim people’s property that was mortgaged by developers.
But after a string of court rulings in cases in which banks objected to the law, the land registry suspended proceedings as the authorities pondered their next move.
In July 2018, banks and legislatures entered into a gentleman’s agreement to address this issue.In exchange for deputies passing a law to make it easier for banks to collect dues, the association of banks agreed to raise no objection on the issue of buyers. This protected people trapped without title deeds if the deal was done in good faith.
Speaking in Parliament on Thursday, Akel MP Aristos Damianou urged banks and “their reputable lawyers” to stop violating the legal rights of fraudulent buyers.