Cyprus Mortgages

If you are interested in buying, building or refurbishing property in Cyprus, there are various products offered in Cyprus that best fits your needs.

Some of the products on the Cyprus market rank among the most competitive and favourable in the market today. These products are available in Cyprus pounds or in foreign currency, offering the option between fixed or fluctuating interest rate as well as flexible repayment terms. They are designed to adapt to customer needs.

There are a variety of housing loans in Cyprus to choose from, with the following main characteristics and benefits.

- Unlimited amount according to your annual family income that can cover up to 80 percent of the purchase price of the property for first residence and up to 70 percent for secondary residence.
- Maximum loan duration of 35 years for loans in € and 15 years (calculated of up to 30 years) for loans in foreign currency.
- Up to 2 years grace period
- Repayment flexibility with the option to choose either escalating monthly instalments or interest only payments for up to the entire duration of the loan and repayment of capital anytime you wish before maturity.
- No need for personal guarantees.

We are able and can assist you in obtaining a loan in Cyprus where you can repay the loan at your ease and convenience with no pressure and according to your financial capability.

Of particular importance to young people at the start of their career and family they can make an easy start with installments that keep up with their income. You can pay interest only during the first five years of the loan. For the next five years the normal installment is paid and for the remaining years, a slightly higher installment is paid to pay off the balance.

A further option is to make interest payments only for up to the whole duration of the loan and repay the capital at any stage of the loan according to your income and future earnings, even on the maturity date with one single lump-sum payment.

A number of Cyprus banks are offering clients a pre-approval of a mortgage loan aimed at facilitating the search and the acquisition of a home. The idea is to give prospective buyers an indication of how big a loan they will be able to take out and the repayment method best suited to their needs. This will no doubt make the search for a home less stressful insofar as finances are concerned.

Setting up a mortgage in Cyprus

Setting up a mortgage is made by the registration of the relevant declaration, namely N271, which is both a contract and a mortgage registration certificate; therefore, it does not need to be accompanied by a separate mortgage contract.

Procedure for setting up mortgage in Cyprus

The Mortgagee and the mortgagor or their representatives, attend the District Land Registry Office, and the following documents are presented for the setting up of the mortgage:

1. Declaration N271 completed and signed by the parties and two witnesses (in duplicate). If the mortgage is to be registered in another Distinct Land Registry than in the district the property is situated in, then an extra copy of the N271 has to be completed. If there is a guarantor for the debt, then declarations N271 has to be signed by such guarantor but he is not obliged to be present at the Land Registry.

2. The title deeds of the properly that is to be mortgaged.

Mortgage stamping

Mortgage as a contract should be stamped. The stamps are calculated on the capital and interests until the loans expiration period. The appropriate department for stamping is the Fees Inspector at the Inland Revenue department.

Stamp duties

1. The original of the mortgage contract is stamped:

1.1 For capital and interest amounts from € l-170,800: 1.5 cent per even' € 17 or a part of the € 17
1.2 For amounts more than € 170,800; € 256 for the first € 170,800 and 3,5 cents per € 17 or a part of C€ 17 that exceeds € 170,800
2. Copies are stamped with a 20c stamp.

Mortgage registration duty

For the registration of a mortgage, duty of 1% on the loan amount is imposed and collected. The Mortgagor is liable for this payment.

Mortgage Registration and registration Certificate issue

Mortgage registration is made by filing its number at the Land Registry Record, against the property in question. After setting up and registering the mortgage, the original of the printed form N27, that represents the Mortgage Registration Certificate, is delivered to the Mortgagee together with the registration certificate of the property. One copy is given to the Mortgagor and the other is kept in the archives of the Land Registry.

Simultaneous Transfer and Mortgage Declaration.

The transfer and mortgage can be attended to simultaneously. In this case it is regarded that mortgage has legal validity from the moment the transfer declaration is made. Transfer of a mortgaged property subject to mortgage

Property, which is burdened with a mortgage, can be transferred by its owner to a third party - subject to a mortgage. This means that the beneficiary obtains the property, and at the same time, undertakes the liabilities that the assignee has towards mortgagee. In order for a property burdened with a mortgage to be transferred:

- No explicit term restricting transfer should be included in the contract.

- The mortgage should not have been set up before 1/1/1967.

- The Assignee should certify in writing, (in a relevant column of the transfer declaration), that he was informed and is aware of the mortgage with all its details.

Mortgage Transfer

The initial mortgagee can transfer the mortgage with all his rights issued from it, to a third party. Mortgage transfer can be made under the following preconditions:

- If it relates to a mortgage that was set up before 1/1/1967 written consent of the mortgagor and all guarantors, if there are any, is necessary.

- If it is a mortgage that was set up after 1/1/1967 and any explicit term restricting its transfer is included in the contract, again the written consent of the above parties is needed.

- There shouldn't be any court order restricting the mortgage transfer.

- A mortgagee, included in the transfer deed should be free of any restriction regarding the administration of his property. Such persons includes those under age, mentally unstable, and persons who have not been declared bankrupt. Only the person that is specially authorised for this purpose by the Court with a relevant order can act on behalf of these persons.

Mortgage transfer fees

For the transfer of a mortgage, imposed fees need to be paid on the same day the declaration is made. The fees are imposed on the unpaid balance of the amount that was borrowed with the mortgage, and are: 0.5% when a parent transfers to a child and, 1% in any other case.
Partial repayment of a property mortgage from the mortgage (Partial cancellation)
A property can be released from the mortgage if the mortgaged debt is partially repaid. The following can be released from the mortgage:

- A section that is smaller than the actual share of the mortgagor on the property that was mortgaged.

- One or two properties from a mortgage that includes two or more properties. In the case that property or properties that will be released are burdened with more than one mortgage, release should be made simultaneously for all mortgages.

Procedure of releasing from mortgage

For releasing a property from a mortgage, both mortgagee and -mortgagor - or their- legal representatives - should be present at the Land Registry. If there is a guarantor, he does not need to be present, however, he should sign in the relevant column of the release document and his signature should be certified by a certifying official or community officer and one member of the local authority.

Total cancellation of mortgage

When a mortgage debt is paid off, the Mortgagee should be present at the Land Registry in order to proceed with the cancellation of the mortgage. He should carry his identity card with him. The mortgagor and any guarantors don't have to be present.

Court cancellation of mortgage

There are cases where mortgages can be cancelled by the Court with a relevant order. These cases are:

- When the mortgaged debt has been paid off and the Mortgagee denies or neglects to cancel the mortgage.

- When the obligation that is secured with the mortgage, has ceased to exist for various reasons and the Mortgagee denies or neglects to cancel the mortgage.

- When the mortgagee denies paying the mortgaged debt for the cancellation of the mortgage.

- When the mortgagor is unable to pay the mortgaged debt because the mortgagee is of an unknown address or has died and his beneficiaries or his personal representative are unknown or do not exist. Also in the event of a company or cooperative that has been dissolved.

- When the obligation that is secured through the mortgage has been paid off or has ceased to exist as mentioned in above in which case, the mortgagor can apply to the district court for the issuing of a mortgage cancellation order.

- When such order has been issued and the Mortgagor fulfils any terms that might have been imposed through the order (repayment of the balance etc), then he can bring a certified copy of the order to the Land Registry and ask for the cancellation of the relevant mortgage, according to the terms of the order. For the cancellation of the mortgage no fees or duties are required by the Land Registry.