ALTHOUGH the Cyprus government remains tight-lipped about details of the agreement reached with the troika easing the procedures for property foreclosures, some details have been leaked to the media.
According to information we have received, which we cannot confirm at this time, the key provisions of the law required to make repossessions more effective and less time-consuming include:
- An assessment of the value of the property in question will be made by the bank and its owner(s). If there is a discrepancy between the two valuations a further valuation will be made by an independent third-party appraiser.
- The property will be auctioned with a starting price of 80% of the its value as assessed by the above valuation procedure. The price will remain confidential and its publication will constitute a criminal offence.
- The selling price of the property will remain valid for a period of three months, after which it will be reduced to 50% of its valuation.
- If the property has not been sold within a year, its value will be re-assessed, but at no time will its selling price be dropped below 50% of its valuation.
The repossessions bill and a second bill on the subject of insolvency are designed to address the issue of non-performing loans, which are currently hovering around 50% of all outstanding loans.
European Commission officials have warned that the repossessions law has to be approved by Parliament before any new aid is distributed.