Could we be wrong?

Financial Mirror (Cyprus) - - FRONT PAGE -

The re­cent leg­is­la­tion on the lib­er­al­i­sa­tion of real es­tate mort­gages and other gov­ern­ment charges (such as property tax, etc.) has greatly helped achieve some sense of tran­quil­ity to the buyer, the State (by achiev­ing trans­fers) and of course the whole op­er­a­tion of the property sec­tor.

My re­cent ex­pe­ri­ences show a great num­ber of dif­fer­ences in what the law says about the release of mort­gages, etc., and what is ac­tu­ally im­ple­mented. Lenders re­quire that the buyer proves that he has paid his dues (and not only present a dec­la­ra­tion and re­ceipts from the seller) and that the rel­e­vant pay­ments were de­posited into the ac­count where the bank loan is held. So, I ask, where does the law re­fer to this spe­cific pro­ce­dure? Lenders con­tinue to in­sist on the above pro­ce­dure even if the loan for this project has been paid off (but per­haps the project re­mains mort­gaged in or­der to fa­cil­i­tate buy­ers who se­cured a loan from the lender), thus even though the de­vel­oper is not obliged to, the buyer has this obli­ga­tion and so the whole sys­tem of free trans­fers is blocked by the ar­bi­trary in­ter­pre­ta­tion (or due to ex­tor­tion) of the law.

What is also sur­pris­ing is the fail­ure of lenders to con­sider a fast pace to re­view th­ese cases of free­ing up mort­gages, etc. In my re­cent ex­pe­ri­ence, a client in­formed our of­fice that in or­der to release even a sin­gle apart­ment, all buy­ers through­out the project must be re­viewed, and even then, one by one.

So? Why is this process be­ing im­ple­mented and where does the law say so? Also, in or­der for the au­thor­i­ties to release the mort­gage and se­cure the property tax, they con­tinue to de­mand full set­tle­ment. But are trans­fers not pre­vented in this way and is this not against the pro­vi­sions of the law?

The law­mak­ers missed out that charges for the mu­nic­i­pal taxes, sew­er­age, etc. be in­cluded in the release, and so, if the rest set­tled or re­leased then this ob­sta­cle still re­mains. I wrote to the Min­is­ter of In­te­rior on this is­sue with the hope that th­ese charges be in­cluded for the release, oth­er­wise the whole sys­tem will be al­most un­work­able (ie. the ef­fort of direct trans­fers). Of course, there re­mains the right of direct ap­peal to the Land Registry for the trans­fer and this Depart­ment is not in­volved in mat­ters re­lated to loan col­lec­tions, etc.

The ap­peal to the Land Registry, with the 5,000 ex­ist­ing ap­pli­ca­tions still pend­ing and which are ex­pected to dou­ble in the com­ing months, is not an easy tast. Be­sides the cost, the wait­ing process may even go be­yond 12/2016 and so the buy­ers can­not reap the 50% dis­count on the trans­fer fees. I ex­pect, how­ever, that de­pend­ing on the progress of trans­fers by mid-2016, per­haps this mea­sure of the dis­count in­cen­tive be ex­tended to the end of 2017.

The eas­i­est thing to do in this coun­try is the fil­ing of a “com­plaint” against sev­eral peo­ple who do not fol­low the law and cer­tainly tak­ing le­gal ac­tion against them. But is this a so­lu­tion or should there be a proper im­ple­men­ta­tion of the law as pro­posed by the gov­ern­ment and ap­proved by the House? Com­plaints filed to the Cen­tral Bank for non-im­ple­men­ta­tion of the law by the lenders or even sub­mit­ted to the In­te­rior Min­istry, the Au­di­tor Gen­eral and oth­ers, may be a lit­tle “in fash­ion” nowa­days, but per­haps in the end we should end up there? Do we need to re­sort to such mea­sures?

Then again, per­haps we have “mis­in­ter­preted” the law and are wrong in the mat­ter, an ar­gu­ment I can hardly find to be re­al­is­tic or log­i­cal.

Newspapers in English

Newspapers from Cyprus

© PressReader. All rights reserved.