Borrowers Association: trapped buyers continue to pay the debts of the developers

This week, despite having paid for their homes in full, "trapped buyers", those who are still burdened with developer debt, expressed their significant anxiety to the Cyprus Borrowers Association (Syprodat).

The frustration and disillusionment felt by these buyers, who are still unable to obtain title deeds for their properties and may face foreclosure if developers do not pay off their outstanding debts, was exposed by Syprodat.

Many buyers have paid all of their bills, but because the title deeds haven't been transferred yet, they still don't own anything. This puts them at danger since developers' unpaid debts could result in the banks taking the properties.

The association explained that numerous buyers have repaid their home loans in full, yet are still being affected by developers' unpaid debts. In a statement, Syprodat criticized the banks, suggesting that they failed to ensure the funds developers received were used to repay loans taken for building projects.

“Banks have seemingly ignored the agreements they had with developers, allowing them to misuse the money received from buyers”, Syprodat said, adding that this behaviour raises questions about the banks' responsibility in these cases.

Syprodat also speculated that if banks had enforced the proper use of funds, the situation faced by roughly 10,000 trapped buyers might have been avoided. Many of these individuals now find themselves in precarious positions, even though they’ve fully repaid their loans.

The association urged the government, along with banks and credit acquisition firms, to take immediate action through new legislative measures to resolve the issue.

In July of this year, Syprodat initiated talks with political parties to stand up for fresh regulations with the goal of assisting buyers who are trapped. They stressed how urgent the situation was at the moment and demanded that lawmakers and the government move quickly.

Interior Minister Constantinos Ioannou also acknowledged the government's efforts to find a legislative solution, noting the urgency to protect trapped buyers at risk of losing their homes.

The situation got further attention following a recent court ruling that declared some provisions, which allowed trapped buyers to obtain title deeds, unconstitutional. In response, the government is reportedly working on a new bill, expected to be presented to parliament soon.