Home Legal Matters Cyprus Title Deeds bank extortion (updated)

Cyprus Title Deeds bank extortion (updated)

FOLLOWING information received from Denis O’Hare of the Cyprus Property Action Group (CPAG), MEP Daniel Hannan has raised the following question in the European Parliament.

(CPAG has also assisted a number of Liasides clients to lodge cases at the European Court of Human Rights (ECHR) against the Cyprus Government for not protecting their property rights.)

Question for written answer E-012350-13
to the Commission

Rule 117
Daniel Hannan (ECR)

Subject: Cyprus title deeds bank extortion

In response to my previous question regarding Cypriot property title deeds (E?006305/2013), Commissioner Rehn stated that ‘The MoU [memorandum of understanding] therefore envisages a specific deadline for the elimination of the observed backlog. The swift clearing of encumbrances on title deed transfers constitutes an important element of this agreement’.

Is the Commission aware that receivers acting for banks are currently threatening buyers with selling their homes unless the buyers pay off the developers’ defaulted mortgages, their taxes and other creditors?

In the case of the now defunct Liasides developer, involving 230 properties, Alpha Bank’s receivers are informing the buyers that unless they pay off the developers’ mortgages and taxes on their homes, the properties will be sold. Due to the level of debt there will be no surplus funds to compensate the buyers, who will then be homeless. Mortgages, which go back to 2002 in some cases, have not been serviced during this period, yet Alpha Bank has taken no remedial action and these now stand at several times the initial mortgage advanced. Receivers’ fees at 11% of the purchase price are also payable by the buyers.

Most of these properties are illegal due to the lack of building permits or completion certificates, yet it is envisaged that the individual title deeds should be transferred to buyers through the courts. Moreover, the deeds will still be encumbered by the many other claims against the developer as a result of creditor court judgments.

Could the Commission please confirm that this extortion by the banks and their receivers is in direct conflict with the terms of the MoU?

More liquidations to follow

LIQUIDATORS acting on behalf of another bank have received permission from the court to commence proceedings to recover the assets of a bankrupt property development company in the Larnaca area.

Reports suggest that the liquidator has said that foreclosures have been put in place to ‘force property buyers’ to settle developer debts; a conservative estimate of their fees is €15,000 – €20,000 per household.

As well as the mortgage debt owed to the developer’s bank and the liquidators fees, to avoid the sale of their homes, those who purchased property from this developer will also be required to pay his unpaid taxes, which amount to some €540,000.

It is highly likely that more development companies will be forced into receivership as a result of the collapse in the island’s property market and an increase in non-performing loans. More liquidations will follow and assets belonging to those companies, including many homes, will be put under the hammer to repay their creditors.

Answer given by Mr Rehn on behalf of the Commission (added)

The Commission is well aware of the unresolved issue of pending title deeds in Cyprus and it attaches priority to resolving it in the interest of the Cypriot economy, the European taxpayer, and the EU citizens affected by the problem.

To this end, article 5.4 of the Memorandum of Understanding includes several policy actions such as

(a) guaranteed timeframes for the issuance of title deeds,

(b) decrease of the title deed backlog and

(c) acceleration of the swift clearing of encumbrances on title deeds to be transferred.

The leading competent authority is the Department of Lands and Surveys (Ministry of Interior). As the issue of the title deeds and the encumbrances attached to them is a complex one, the co-operation among a number of Cyprus’ public administration units is also required.

The Commission would also like to inform the Honourable Member that the Cypriot authorities have already created a specific framework for dealing with troubled borrowers. Concerns about such dealings should be addressed to the appropriate national authorities, including the Central Bank of Cyprus and the Financial Ombudsman.


  1. @Nige – I expect that your contract of sale, like many others I’ve seen, makes you responsible for local taxes from the time you took delivery of the property. The clause in your contract will look something like:

    “The purchaser shall, as from the date of delivery of the Property, pay all taxes and rates, in respect of the property and generally all expenditure, taxes, fees and charges in relation to the property and in the event of these being charged to the vendor during the period prior to the registration of the property in the name of the purchasers.”

    Before paying, the company needs to provide you with “records of the amount paid as Immovable Property Tax (IPT) and a certificate showing the rate of IPT applicable to the property” – (please refer to this letter from the Interior Ministry). This will enable you to recover any legitimate overpayments of IPT you may have made once the deeds have been issued and the property has been registered in your name.

    Aristo has to pay Immovable Property Tax based on the total 1980 value of all the properties registered in their name – this will include the properties you have purchased plus all the others that have yet to be transferred to their purchasers. I expect Aristo will be paying at the highest rate – for 2013 this is 1.9%.

    I suggest you read Immovable property tax & fraudulent practices (legal opinion obtained from CPAG)

    And also Immovable Property Tax law.

    In future, can you please raise questions in my Cyprus Property Forum.

  2. We have just received a bill from Aristo for provisional property tax 2010-13. 2010/11 are €366, 2012 €732 and 2013 €1738! Had to laugh. To be paid in 2 weeks and due to high numbers of clients they are unable to discuss individual cases! We are in Secret Valley and have no title deed yet. Should we pay? Any advice welcome.

  3. I was recently told by someone who has just got their TDs (after 8 years) that the delay was because the developer could only settle the outstanding debt on the “mortgages” (on the land that they had bought and paid for) at the rate of 4 or 5 a month and TDs could not be issued until the mortgages had been cleared. I am sure this is much nearer the truth than the oft repeated claims that it is LR dragging their feet etc.

    Since the problem appears to be that the developers are unable to pay off the mortgages that they have either illegally raised after they sold the property or failed to redeem then it is not clear to me what action the Troika can take to “ensure” that this problem is resolved.

    Although the banks may be able and even inclined to “forgive” or write off these debts the liquidators cannot as they are obliged to recover all discoverable assets (which include these debts) form any source in order to settle the outstanding claims by the creditors. If the legal situation allows recovery from the home owners it is difficult to see how they can be defended other than by retrospective legislation which, itself, raises too many “unintended consequences” to be safe (other than for lawyers who will do very well out of the whole affair whichever way it goes).

  4. @Tine Jordbræk – Thanks for posting the replies you received from the bank.

    I’m sure the banks realise that if they start demanding money from people who were sold property built on land that the developer had mortgaged to the bank to repay the developer’s debts, they will destroy the property market.

    I published an article by Dr. George Mountis a few days ago with some ideas of how some of these mortgages could be cleared – Stemming the rise of non-performing loans.

  5. Last mail from the central bank seems that this will be solved by the end of the year

    The issue of title deeds is the responsibility of the Land Registry Department, so your complaints and concerns regarding this matter should be made thereto. In the meantime, I would like to inform you that the backlog at the Land Registry Department is planned to be cleared by the end of the year and it is our understanding that top priority is assigned to the projects of developers.

    Mary Kyriakidou
    Bank Supervision and Regulation Department

  6. This shows that there is no rights at all

    Dear Ms Jordbræk

    The rights and obligations of buyers rely on the terms of their agreement with the developer and with the mortgagee bank (e.g. whether letters of guarantee have been issued, whether there was release of the developer’s mortgage etc) as well as on the applicability or otherwise of The Sale of Immovable Property (Specific Performance) Law of 2011.

    We remain at your disposal for any further clarifications.

    Mary Kyriakidou
    Bank Supervision and Regulation Department

  7. Nigel. As you know I wrote direct to John Hourican about six weeks ago essentially asking the same question. To date I have not received the courtesy of a reply.

    I seem to recall John announcing a new era of honesty and transparency following his appointment at the helm of BoC but fear he has simply settled in rather quickly to the “artful ways”.

  8. On a teacher’s training course we were taught three things. Firstly to start with something nice, then slip in the point you want to get across, and finally finish on a positive note, so as not to crush the sensitive soul.

    I found it a waste of time all the pupil could recall was the positive sounds. The message was lost.

    In this case Cyprus on the MoU it would be. “Troika have told us we are performing well”

    And the bit in the middle, well that is already forgotten.

  9. Reading Mr Rehn’s reply again, I think it speaks volumes in terms of what it does not say. In particular, it certainly does not say that buyers will be protected against bank repossession due to developers having defaulted on mortgages.

    The banks have a legal right and a duty to their depositors and shareholders to pursue delinquent borrowers and attach their assets to sell in respect of the unpaid mortgages. The tax authorities have similar duties in respect of unpaid taxes, not to mention general seizure of assets by banks in respect of developers’ defaulting on unsecured loans, of which there have been plenty.

    I wonder if there has always been a perfectly legal way to ensure that buyers of ‘off plan’ properties were in full control of what they were buying and that is to divide and sell the land first in a separate contract before any building took place. That way the land owners would own the assets built on them. For example, a development of thirty houses or apartments could be sold to the buyers by selling the land to them first. This does involve more work and legal costs, but it does not seem impossible.

  10. Have I missed something here, but who do the bank think is going to come along and buy these properties as they are illegal and come with all the developers debts attached anyway?

  11. Many thanks to Mr Daniel Hannan and his Team for their sterling efforts on behalf of these scammed Property Buyers in Cyprus.

    However there is still no straight answer from Rehn if or not the Property Buyers who have paid the Developers directly in full, are to be protected by the EC against any foreclosures by the Developers lenders ad nauseum! RB.

  12. @Elizabeth – thank you. The Troika has just completed it’s third assessment of the Cyprus Economic Adjustment programme.

    I expect we’ll see their third review published in a few weeks. Hopefully things should become clearer about the government and the banks plan to deal with the mess they have created.

  13. I feel for these people, I really. my property was not new when I bought it, and my money settled his debt at the land registry, but I still had to wait five years for the deeds….I hope the EU is in favour of the people who bought !.

  14. As far as I know a senior Cypriot politician has never made any meaningful response to the property/loan/deeds mess that is now so widely known. Cypriots are caught up in this mess as well so I assume they lobby their local MP. Do they not have an equivalent of ‘prime ministers’ questions in the Cypriot Government where local MP’s/back benchers can as questions on behalf of their constituents regarding matters which affect them??

    I also wonder how long this can go on for. Either the MOU is enforced, delayed and revised or not enforced. Either way, something has to happen very soon. I really don’t see how the banks can remain solvent and the government for that matter. I just want the scale of this problem acknowledged and then we can get down to the real business of sorting it out. How many more years will I and others be writing this sort of thing!

  15. Daniel Hannan should be congratulated for maintaining the pressure on the European Commission and therefore, hopefully, the Cyprus govt.

    I’m sure, like me and my wife, many owners bought properties not to make a fortune (maybe a reasonable return because that’s what we were led to expect) but to have a home to retire to or holiday in etc. a bit of “value- added” for our hard work!

    It takes a long time to wake up to and accept the depths to which the Cypriot banks, lawyers and developers are capable of sinking to.

    I think we ARE now waking up to this reality and we must unite and fight for what is right and just – never mind ” this is Cyprus”!!

    Unending gratitude again to Nigel whose unbiased and clear-sighted advice remains a constant reassurance.

  16. A lending bank calling in the mortgage loan(s) it has made to a developer company typically does not have a legal duty of care towards the buyer of the property sold by that developer, according to a lawyer. As a consequence property buyers find it difficult to bring a legal case against the developer’s lending bank. However, please consider the following summary which is offered on the basis of my personal experience, and in the hope that it may help a property buyer win over a liquidator:

    When a lending bank agrees with a developer to advance a mortgage loan that loan is made on the basis of asset based lending, i.e. the mortgage is granted according to the developer’s ability to deliver collateral assets to the bank rather than his ability to service the mortgage debt; and the property purchased by the buyer and sold by the developer will be taken by the bank as a collateral asset.

    The bank will receive from the developer a copy of the sale/purchase agreement struck between the developer and the purchaser. Any imperfections/deceits/material breaches within the agreement will therefore be known to the bank. So, for example, if the developer has not declared in the contract the existence of mortgages over the property, the bank will be aware of that fact. However, the lending bank will do nothing to alert the purchaser about the contradiction because it will not have a duty of care towards the purchaser, only its client the developer.

    Via the sale/purchase agreement the lending bank will also be aware of the costs being borne by the purchaser and the schedule of payments to the developer. Typically, if there is a schedule of payments allied to building progress, the lending bank would agree with the developer that a proportion of each staged payment, say, 20%, should be paid by the developer to the lending bank to pay down the mortgage debt relevant to the plot/property purchased by the buyer. Should the developer fall into arrears or not make any payments at all, the lending bank is not too concerned because it has the collateral value of the property to compensate for the lack of mortgage payments. In good times collateral assets values increase year on year or, at worst, remain neutral. In bad times, such as now, collateral assets fall below their original values and hence the lending bank is forced to call in liquidators to recover developer company assets.

    Typically, perhaps, the property buyer would be unaware of the facts or implications set out in the above three paragraphs.

    The above behaviours illustrate that lending banks are to blame for creating the conditions which ultimately result in buyers’ property being taken into receivership. But how does a buyer take the developer’s lending bank to court to prove culpability by the lending bank if the law says that the lending bank does not owe a duty of care to the buyer?

    The short answer is ‘with difficulty’. Another, perhaps, would be for the buyer to subpoena the lending bank to attend court, so that the facts could come out in legal examination. This assumes that the buyer has initiated a court case in the first place. KD.

  17. @sj – ABSOLUTELY NOT!

    A liquidator can only sell off the assets of the company, etc they are liquidating.

  18. @Nigel – should the property be repossessed, they will not be able to recover all the debt. Does this mean the liquidators will come after the UK home to recover the rest of their remaining debt?

  19. I suppose this sorry business is no longer a scam or fraud or extortion or anything. Its been condoned and encouraged by the Cypriot Government and the courts. Perfectly legal and above board! Can I pick and choose which legislation I comply with or is it only certain EU member states that have this prerogative??

  20. @Andrew. I agree that the lawyers are at the heart of the problem as the facilitators and technically should be ultimately responsible for their clients ills. Regrettably, as I know from personal experience, the CBA seems to believe it is there to protect their members rather than the clients who have been negligently (just being nice) advised by their Lawyer.

    The whole property system is wide open to corruption, fraud and abuse yet no one is held to account nor does the government take any steps to resolve matters.

  21. Is it still safe for us to go to Cyprus to try and negotiate with the banks, or is it a bad idea?

  22. @Steve.There is one significant difference in your analogy of the stolen car. You would not use a lawyer to buy a car.

    Surely most home buyers have paid a Cyprus Bar registered lawyer to represent them during their purchase. These lawyers are the major link in this wholesale deception. Many of these lawyers have qualified in UK Universities, therefore they know full well the consequences to their clients of not being diligent. Anyone who loses their home should seek compensation from their lawyer.

    The EUROPEAN COURTS should hang their heads in shame if they allow so many innocent people to be defrauded in this way.

  23. Nigel is correct in saying that the banks could “forgive the debt” however the liquidator cannot as he will have a legal duty to the creditors to recover any assets he can.

  24. @Denton Mackrell re your comment at 6:45 pm

    The banks could write off the bad debts – but I’m almost certain that the banks would need a further bailout (or bail in).

    Alternatively they could sell the bad debts at a heavy discount to recoup at least some of the money they handed out indiscriminately. (But that would not help buyers).

  25. @Steve. I am not so sure the banks are thinking in terms of repossession if they can instead ‘encourage’ the buyer to default by refusing to pay his own loans, or indeed anything related to the property even the developer’s debts. The bank then by-passes the Cyprus property (which under repossession would be almost worthless in the current market) and instead seeks an order for payment in the buyer’s own country.

    At least in the UK the buyer’s property there has some value and can be liquidated easily in a more buoyant market. Cynical and cruel I know, but then that is what we have come to expect from a morally degenerate bunch of banks in Cyprus.

    They have not lost their moral compass – they never had one to lose.

  26. Steve.
    Whilst not directly involved at the moment and therefore perhaps easy for me to say but I am not sure that settling any part of the developer debt is the answer. Not sure what is.

  27. Thanks to Daniel Hannan for raising the issue with Commissioner Rehn, as he has already done previously. We have seen the EU as grounds for optimism in the past, but it has always come to nothing and I have little doubt that this time will be any different. If I remember rightly, the MoU, published around this time last year, stated that the banks were expected to foreclose on defaulting developers and sell their assets, including property to which they have title deeds, to reduce the banks liabilities. Did I see somewhere that 50,000 properties could be affected?

    Nigel (as he has done before) and Mike have made it clear below that this is not some illegal witch hunt and that it can happen. I know it is hard to believe and to seek refuge in denial might make it easier to cope with, but it will change nothing, as can be appreciated by looking at the situation in a different way. The developers have stolen money from innocent people wanting to buy property and they have done it by selling something they did not actually own because it had been or would be used as collateral in another deal with a bank or banks before transfer of title. If my developer defaults before the transfer of title, I stand to lose all the money I paid. I won’t lose my property because it has never been my property. The only redress I will have (because I “bought” with no title deeds available) is to sue the developer to get my money back, but he has no money otherwise the situation would not exist. In other more civilised and law-abiding countries, I could attempt to get the developer tried for fraud, but in Cyprus a previous Attorney-General decided that this theft by deception was not a criminal matter, more a private disagreement and therefore a civil matter.

    I think of it as being akin to buying a stolen car in in the UK. If, one day, a policeman tells me my car is on the stolen list and impounds it for return to the rightful owner, I wouldn’t have a leg to stand on and I shouldn’t expect compensation. Having said that, I think there are some predictable outcomes that may offer some respite. If the banks take over lots of property and can’t sell it, then they just incur further liabilities like maintenance, insurance, rates, water and refuse collection charges. In some cases they are making threats to get the occupants so frightened that they will be willing to make a repayment deal to cover some or all of the developers debts. Maybe time to sit tight for a while and see if the banks offer to settle for less.

  28. Well I cant see how the liquidator/banks and solicitors in our case can sort things out. Our English developer is in liquidation, no company accounts worth mentioning were submitted.

    The houses he built are unfinished and the deposits he took on 16 other off plan properties have not materialised. Alpha Bank lent nearly 500K euro against these developments, not to the developer but to individual purchasers. The funds that were taken have long gone off the island and the company assets are nil.

    No title deeds, no completion certificates and a half finished site plus 2 large plots of farm land with permission to build 1 property are all that remain. There are not enough funds to pay the liquidator even if there was somebody foolish enough to buy the unfinished site. SORT THIS ONE OUT BOYS.

    Nobody involved in selling these properties will get paid, the money has long gone.

  29. @Peter Davis – Thank you for your comments.

    I believe that the receiver has a court’s authority to proceed with the liquidations – and a number of people who bought from the developers are fighting to keep ‘their’ homes in court.

    I know one of the lawyers trying to help these people and he is so angry with the situation, I’m surprised he hasn’t exploded.

    Some of those affected are retired and living on their pensions – they cannot afford to fight this travesty of justice through the courts. I know that some of them are considering leaving to live with their children or relatives and tell me they will torch their homes before they leave.

  30. @Denton Mackrell re your comment at 12:44 pm.

    None of these people will have mortgages on the properties they purchased – but some may have ‘home loans’ (aka Construction Loans).

    A ‘home loan’ is not a mortgage – it is a loan guaranteed by the developer for the purchase of one of his properties that has yet to be built and/or issued with its Title Deed – and the developer draws on that loan to fund the construction of the property.

    A mortgage is advanced based on the value of its underlying collateral (i.e. a property). But a property does not exist until it’s Title Deed has been issued.

    Those who have taken out home loans to fund their purchase will have that home loan converted to a mortgage when the property’s Title Deed has been issued and its ownership has been registered in their name. That mortgage is then lodged against the title of that property as an ‘encumbrance’ that will prevent the transfer of that property until the mortgage debt has been repaid.

  31. @Nigel. Thanks for info re SNK etc.

    From your reply to Diane Best @10.48, am I correct that all 230 purchasers being pursued had no mortgages of their own on the properties i.e. they are being pursued solely for the developer’s various debts? When this story first arose in late 2011, the number of those without mortgages was cited as 70 out of some 230.

  32. @Diane Best

    There are three groups of creditors:

    The first paid is always the fees of the liquidator. Otherwise he will be working for nothing. Anything left goes to 1, 2 & 3 in this order.

    1st The Government. This takes its money for outstanding debts such as NI payment, taxes etc.

    2nd Secured Creditors. Individuals or Companies with a fixed or floating mortgage. A fixed mortgage would be for instance on land or property. A floating mortgage is on any asset and crystallizes on bankruptcy or insolvency. (individuals go bankrupt and companies become insolvent).

    3rd Unsecured Creditors. Anything left (which is usually nothing) is shared equally among these people or companies. This would be the category of the homes buyers. Including those who have fully paid for their house/villa as it will be shown as an asset of the company or owned by the bank.

  33. @andyp re your comment at 11:47 am

    I can’t recall seeing anything about these particular cases in the local media.

  34. Their actions are either lawful or not. If its a case of just making up their own laws then the entire EU justice system would crumble. Maybe this will only be decided once more lawyers have earnt a packet out if the scam.

  35. Blackmail definition.

    “With a view to gain for himself OR ANOTHER (ie Bank) or with INTENT TO CAUSE LOSS TO ANOTHER (you) makes an unwarranted demand with menaces”. A threat of menaces would include a threat to withhold deeds unless money was extracted on behalf of the Government, bank or another individual.

    Make a complaint to the police, who of course will most probably refuse to accept it. So go higher, and higher. Make an appointment to see the boss at Paphos Police Station. Explain that a complaint no matter how innocuous must be recorded, so you want a crime number. A refusal – move to the Ombudsman. The belief that Government employees or bank employees making threats are above the law appears to be part of the constitution. For example asking more money at the Land Registry for your title deeds.

    Also report the matter to the EU Ombudsman. (email address on the web) Easily done to take the matter to the ECHR. A court designed for the individual acting without legal assistance. BUT beware there is a time limit.

    Details of how to process a case are held on Google – simple and straightforward. As a law lecturer I also produced a simple one sheet on how to process a claim to the ECHR (prior to Google days)

    Or do nothing and lose your home?

  36. @Denton Mackrell re your comment at 9:30 am

    The development company in the Larnaca area is ‘SNK Venus Home Developers Ltd’ and ‘SNK Exclusive Properties Ltd’ and one of the banks is Bank of Cyprus.

    I believe the defunct Laiki Bank is involved in one of the company’s developments, but I cannot confirm as I have no first-hand documentary evidence.

  37. @Pippa re your comment at 11:05 am

    The fact that a buyer may have lodged their contract of sale at the Land Registry does not inhibit the bank from trying to seize their property.

  38. @Nigel. Re your post of 11.02.

    Do you know if this information is being reported in the Cypriot press? It seems to me that the whole country needs to waken up to the realities of the situation very quickly. As you say this is not just a problem for us moaning brits.

  39. Diane, from a legal standpoint the actions stated are perfectly legal, arguably not ‘fair’ but perfectly legal. Nigel has explained without ambiguity.

    Like you I have secured my title deed but I certainly do feel for those caught up in the corrupt, state sponsored thievery that is at the heart of this debacle. The EU commission I fear will offer no help other than meaningless lip service to the victims of this well organised crime.

    Let us hope someone somewhere realises the damage being created to the Island’s integrity and addresses the facts but I will not be holding my breath.

  40. @Nigel, What, if any, guarantee does any one have that their property will not be seized if their contracts were properly lodged at the Land Registry, although these buyers do not have title deeds?

    If this is not the case then the whole process must be suspect, and just compound the fact that the government as well as the banks were all involved in fraudulent practices.

  41. @UBoat – I can assure you that it not only ‘johnny foreigners’ who are fighting the banks to keep their homes.

    Company liquidations are affecting even more Cypriots.

  42. Well It was bound to happen.

    They have run out of ways of getting money “legally” from all foreigners, So now they just go deeper into the shadowy world of Cypriot law and take anything any way they can think of. It is a disgusting state of affairs these poor people who have spent and are still spending hard earned cash and life savings in their country, contributed when asked willingly to their economy over the last 10 – 15 years are still being Robbed of their money, Homes and life. Many of whom are in their later years who thought like me that Cyprus was a great place to spend your mature life in the sun. how wrong we all where.

    Its happening Now and I believe it wont stop! All we can do is minimise the damage it has caused or will cause. So how do we do this ?

    Answers on a match box to …….

    The law is not on our side (it is not our country) The EU don’t seem able or willing to stop it or even try.

    Our own government (apart from a few) don’t give a Dam ! If the legal process could help They will take years of talks while the raping and pillaging of honest hard working people’s accounts and life’s continues at more and more increasingly underhanded measures by the Cyprus Government and its cronies.

    What is the answer? petitions, demonstrations court actions? the actions of the few unfortunately wont help the needs of the many in our life time. The few have helped don’t get me wrong, and our continuing to do fantastic work. But No one is listening. An age old tactic I am afraid “just pretend all is well and they will get fed up and go away in time” and so it continues.

    And those that go to church should pray maybe that will help ?

    Happy Sunday every one.


  43. @Diane Best – I can assure you this is not scaremongering!

    Those who purchased property on the Liasides developments and the development in Larnaca that I mentioned are now fighting to save their homes.

    As these unfortunate people do not have the Title Deeds to the properties they have purchased, they are considered ‘unsecured creditors’ and treated accordingly – they do not own the properties they purchased.

    In liquidations ‘secured creditors’ such as the government and the bank are given top priority when a company’s assets are sold off to repay its creditors. ‘Unsecured creditors’ pick up the scraps (if any) that remain. But there will not be any ‘scraps’ in these cases because the value of the company’s assets are far outweighed by their debts.

    None of the people affected have mortgages. A mortgage pre-supposes that Title Deeds have been issued and that properties have been registered in the name of their purchasers. Had this been the case, those who bought properties from these companies in receivership would be unaffected by their liquidation.

    Be in no doubt that if you do not have the deeds to the property you purchased and your developer goes into receivership, you face the very real risk of losing your home when the company’s assets are liquidated.

  44. Fortunately, I am not affected with the negative points of this report. I have my Title Deeds and no mortgage.

    But, there is no way under International Law that any bank, government and or courts can demand that owners of homes will be liable to pay any of the mentioned debts of the builder, to retain ownership, nor can anyone eject any resident/owner of the properties from the properties, providing they have paid, and continue to pay the agreed amount in mortgage repayments with themselves and their mortgage banks !!

    This is merely “Scaremongering”!!!!

  45. @Nigel. When the Liasides/Alpha Bank case first surfaced in late 2011, various reports indicated that of the 230-odd properties in question some 70 had already been paid for in full by the purchasers. Are you able to confirm that (a) this proportion is correct and (b)even these buyers with no mortgage of their own relating to the property are being pursued by the bank for the developer’s bank debts, tax debts etc?

    Regarding the ‘other bank’ and a bankrupt Larnaca developer, I guess you have good reason not be specific in your article. However, I’d appreciate an e-mail or phone call with the info on an non-attributable basis.

  46. Let’s hope that this news is being picked up by the press in China, Russia, Ukraine and other countries.

    It looks like all the bananas are coming home to roost in the artful republic.

  47. Way past time everything was made public. The liquidator himself said people were on the take at Alpha bank and that people were being held to ransom and blackmailed into paying a loan they were never involved with (actually seven consecutive loans with none ever being repaid) and although it was not legal, the taxman in Cyprus was demanding money or else he wouldn’t release the title deeds. So, either the government come down on the taxman or they’re part of the problem. In regard to the second headline, it is believed the same liquidator is involved.

  48. I wait with baited breath for the EU response, but do not hold out any hope that this will be in the buyers favour. As AndyP so rightly says the banks knew exactly what they were doing and in a civilised society they should be the ones to pay. But this is Cyprus, the land of bandits, where human rights seem to be only in the imagination.

  49. Sorry for the language folks but those involved in this proposed extortion of innocent buyers are scum. The banks knew exactly what they were doing when they started down this path many years ago.

    Sadly many have been warning of this for years and both the Cyprus government and EU have done nothing.

  50. No more evidence required that they were all in it together. A state endorsed conspiracy. It’s beyond a scam. It continues even when exposed. If this is acceptable to lawmakers and law enforcers then maybe I should become a crook and be protected by the system. What a shameful day for the rights (or rather lack of) of EU citizens.

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