09.12.2023
President Nicos Christodoulides announced legislation passed in parliament on Friday aimed at combating foreclosures, saying it was “a milestone towards financial stability and the country’s financial prospects.”
During the marathon plenum, the majority of deputies voted to introduce measures into the law aimed at speeding up debt collection procedures and providing additional powers to the financial ombudsman.
Amendments submitted by AKEL , EDEK and Green Party did not get enough votes to pass the law.
“This issue has been pending for many years, creating a risk to the financial stability and financial confidence of the country. After months of persistent effort, it was successful,” Christodoulides said in a written statement after the vote.
“The comprehensive package approach promoted by the Government complements the legislative framework that will ensure effective protection for vulnerable and prudent borrowers.” A day earlier, he said that if some amendments were not adopted, he would veto it.
One of the new laws empowers the Supreme Court to appoint judges who can expedite cases when mortgagors challenge foreclosure proceedings on their property. We are talking about primary housing worth up to 350,000 euros, as well as premises for small businesses.
A separate law was also passed to expand the powers of the financial ombudsman to appoint an intermediary who can work on loan restructuring.
The Commissioner will act as a mediator in cases involving primary residences worth up to €350,000 and commercial properties worth up to €750,000. When asked if he knew who he was going to appoint to the position, Christodoulides said he had two or three candidates in mind.
Two more bills were passed from DIKO, EDEK and DIPA, which regulate the right of a debtor to file a complaint against banks regarding their main place of residence to the Financial Ombudsman.
If the financial ombudsman rules in favor of the individual, the foreclosure process is suspended until the case goes to trial.
Meanwhile, six laws were passed unanimously that expand the definition of the term “restructuring” to include the disposal and transfer of real estate to the Cyprus Asset Management Company in the context of the implementation of the mortgage-to-lease scheme.
Christodoulides thanked the “responsible political forces of the country” for their cooperation.
“Today’s development demonstrates the promise and potential of our country when prudence and responsibility prevail. I am optimistic that implementing sound policies will protect our economy and bring continued growth and progress to our country.”
