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Can the Cyprus banks pursue me in the UK?

I have been contacted by many British buyers who have received warning letters at their UK addresses from developers and banks in Cyprus concerning delayed mortgage repayments.

IN MAY last year I published an article ‘HELP – I can’t pay the mortgage!’ offering advice to those who were having difficulties in making mortgage repayments on properties they had bought in Cyprus.

More recently I have received numerous emails from people who have received letters at their UK homes from developers and banks in Cyprus who granted them mortgages to purchase property on the Island.

These letters warn that legal action will be taken against them in the UK courts if they fail to maintain their mortgage repayments. Some people who have received these warning letters were totally unaware that they even had a mortgage; all are very concerned of the threat of losing their homes!

It appears that lawyers (allegedly) acting on their behalf arranged mortgages after buyers had signed Power of Attorney documents that gave their lawyer very wide ranging powers to do just about anything on their behalf (including taking out mortgages they did not want, ask for, or need).

If you have received one of these letters, take heart. The laws in Cyprus are very specific on the certification of Power of Attorney documents:

Firstly, Power of Attorney documents must be signed in the presence of a Certifying Officer.

Secondly, if the person signing the document is not known to the Certifying Officer then either:

  1. That person must show the Officer their ID card or passport as proof of their identity and the Officer will then compare their photograph and signature or
  2. Their identity must be confirmed by two people who are known to the Officer personally and who will then sign the document as witnesses.

Thirdly, any shortfall in the observance of the law by the Certifying Officer may result in the Power of Attorney and any transactions done with its use, such as signing Contracts of Sale and obtaining mortgages, to be declared null and void.

(The Certifying Officer may also be held personally liable to pay damages to the person whose signature he certified without knowing him/her).

I advise those who have received letters threatening legal action by the banks in Cyprus to seek advice from their UK lawyer – and in particular their views on the outcome of a court case based on the information above.

Have the banks got wind?

It appears that the banks in Cyprus may have got wind of the situation and are aware of these invalid Power of Attorney documents and some other issues.

Some of them are sending mortgage application forms to people living in the UK even though they already have a mortgage.

By completing and returning a mortgage application form you would compromise any argument you may have that your Power of Attorney document is invalid.

The Cyprus banks are also sending out letters to those with mortgages asking them to sign statements confirming that they were advised of the dangers regarding exchange rate fluctuations and possible increases in other currencies interest rates.

What is clear is that by signing any such statements and returning them to the bank you would probably prejudice your case.

Furthermore, if you were advised to buy in Cyprus and to take a mortgage by a UK-based registered financial advisor who ‘witnessed’ your signature on a Power of Attorney document it obviously be considered as being an illegal document which would nullify any transactions done with its use.

You may wish to check with the Financial Services Authority (FSA) to see if your UK-based advisor is registered with them. If he or she is registered you may complain to the FSA and make a claim against your advisor on the basis that if you had been advised of the full facts about your potential purchase, you would not have gone ahead and bought. This would be especially so in the case where you later discovered that the developer had mortgaged the site on which he was building.

Should your advisor be unable to meet such a claim the Financial Services Compensation Scheme (FSCS) may very well be able to assist.

Readers' comments

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  • @Anna – You can find all the articles concerning the prices of property under ‘Property Prices‘ at the top of the page.

    The price index used to be published on behalf of BuySell Cyprus by MAP S Platis, but this was discontinues some time ago.

    At the start of this year, RICS Cyprus started its own index and this is the one I publish.

    If you want your home professionally valued, contact the ‘Cyprus Association of Valuers & Property Consultants‘.

  • Anna Skapoullarou says:

    Have you published any articles on evaluation of a property (residences) – what is the procedure to get a valuation – are procedures done differently in Cyprus than the UK and do you have any charts showing valuations a few years ago and evaluations of homes now?

  • Andyp says:

    Just when we thought it could not get much worse.

    Yet another Cyprus property/banking scam.

    What will they think up next?

  • @Lee – I cannot comment on the reasons why the bank are asking you to sign papers again – you will have to ask them.

    Just because the unmentioned lady has connections with the developer makes her devious, not illegal.

    As I recommended earlier, you should speak with your UK lawyer and get their opinion on the matter.

  • Lee Dodd says:

    Morning Nigel

    As I said Last week I had a Threatening Letter from Alpha Bank. I have the Chance to Rent My apartment out For 12 month maybe even Longer. The agreement has been signed by the people who want to rent the apartment and Myself and the bank are happy to go ahead. Now Here comes the Next problem. They want full signing of New documents at a Cyprus Embassy in the Uk by myself and my ex wife (we have been split up since May 2009).- I am in Northumberland she is in surrey and we dont even speak anymore . they want her new passport details aswell. Now does that show the Origional paperwork signed at The solicitors office in 2007 with the witness of Nigel from Mri is Null and Void ?? and the Bank are worried and they know it is null and void and tricking me into signing up ?? if we did sign the new paperwork would we then make it Legal ?? Also as we all know the Un Mentioned Lady Lawyer is connected to the developer does that mean it is all null and void also ??

    Kind Regards


  • Anna says:

    I have noticed MRI being mentioned many times in these columns and have thought how unfair it is that the chief originator of MRI is currently sitting in luxury in England (I think) being the wealthy chairman of Peterborough United, whilst some of the people who bought their homes in good faith are suffering. However, as far as I know,nobody has ever told Peterborough United that their Chairman has a dodgy past. Perhaps it is time to do so. Or has somebody already done this?

    Nigel is presumably at large in the UK. He told us untruths also which persuaded us to buy through MRI. We seem to have been more lucky than most, in that our flat appears to be well built, and so far we have not had problems of the sort I have noticed which other people have. The mortgage and what we owe has worked out a lot more than we were told it would.

  • paul ruse says:

    Thank you for a very interesting article, Nigel.

    We must all use this to complain to our Euro MPs, not just those in the UK, but also those Cyprus Euro MPs after all it,s their country, their C**k up and they should be to account.

    There is a demonstration at the NEC Birmingham on the 1st to the 3rd of October at a property show where Cyprus developers will be advertising, it starts at 9 am every day. Please support this if you can and tell the local press in your area. The more bad press for them the more pressure to change.

    Thank you.

  • @Chris – The article refers to Power of Attorney documents that are invalid because they have been incorrectly attested – and therefore any transactions done with their use, such as signing Contracts of Sale and obtaining mortgages, may be declared null and void.

    To answer your question, yes the banks can pursue mortgage holders in the UK for unpaid loan repayments – but this would not happen immediately. The developer would probably file a claim for ‘Breach of Contract’ and if successful the court would issue an order enabling him to withdraw the contract of sale from the Land Registry. The property would then be re-sold and the bank would get its money. If the bank did not recover enough money, then there is a possibility that it would pursue the mortgage holder in the UK. (Whether it would do that, I cannot say as it would probably kill the property market here stone dead! – and I haven’t heard from anyone who has been taken to court in the UK by a Cypriot Bank).

    You should read the article ‘HELP – I can’t pay the mortgage!’ for advice on how to deal with this situation.

  • Chris Woodward says:

    This article only refers to situations where a ‘power of attorney’ would appear to have been used without knowledge or consent it doesn’t answer the question can the banks pursue mortgage holders in the UK for unpaid loan repayments??

  • @Lee – I suggest that you speak with your solicitor in the UK. Take all the papers you signed plus a printed copy of this article with you. (Use the print button in the middle column)

    In my opinion, as your signature on the Power of Attorney document was not attested by a Certifying Officer it is invalid – but you must check this with your UK solicitor.

    (I have removed your Cypriot lawyer’s name as what you say about her could be considered libellous. But I know other people who have had similar problems with her).

  • Lee Dodd says:

    We signed the paperwork at ***** ********* office in Paphos in November 2007 and it was witnessed by Nigel from MRI who have since disappeared from Cyprus after numerous lies etc. MRI should be sued !!!! I am not sure now if it was legal ???

    ***** went and did things I told her not to do. She has ties with the developer she went ahead and did it like releasing mortgage money when I said no wait !!!!!!!!!!!

    I have had the threatening letter from the bank this week and have had to rent my apartment long term which has got me out of a hole and I am very grateful to my lettings lady out there in Peyia Fay as she has been brilliant in all aspects. The bank have been good to me though probably as they do not want a repossession on their hands so at least for 12 months I have a weight lifted from my shoulders but I can see the banks being brought to their knees. I feel my next step is to be put against a wall and shot as fed up with threats from banks developers solicitors.

    I was threatened by the developers with legal action as well all we get is pay up or you will get legal action. Then I get a water bill of €250 – I have never even stayed in the place or rented it out but I get told its not there problem and guess what ?? Leeeeeegal Action will be taken if I don’t pay up !!! NOW WHAT A SURPRISE ???? I have spent £500 on advertising but got no rentals this year at all waste of money !!!!

    In total I have sunk £30,000 into the place and for what ???

    We just pay out all the time and for what ?? A major headache and sleepless nights.

    The worst thing we ever did was buy the place .

    Cyprus is not what it was 4 or 5 years ago either. Since the Euro it has gone down the tubes and a lot of nice people have been turned upside down. Cypriot and British.

  • @Brian – There are no Notaries in Cyprus. However, there are Certifying Officers whose only function is to authenticate documents.

    Certifying Officers are independent officials appointed by the Ministry of the Interior.

    Furthermore Certifying Officers must not have any relations as an employee of or any professional relationship with any lawyer or real estate agent, bank, company or corporation. (see

    And yes – Power of Attorney documents must be signed in the presence of a Certifying Officer.

    I hope this answers your questions.

  • Brian says:

    Is a Cypriot Lawyer also regarded as a Certifying officer as in the UK? or are you saying that her in Cyprus the document must be signed in the presence of a Notary?

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