Introduction
In 2014 the Transfer and Mortgage of Properties Law was amended
to introduce a streamlined foreclosure process aimed at helping
banks to address the persistently high levels of non-performing
loans and the issue of so-called 'strategic defaulters'
(ie, borrowers that have the means but not the intention to service
their debt).
Several of the amendments were ambiguously drafted and borrowers
were quick to oppose them. Numerous court appeals were filed, most
of which were successful in suspending foreclosures that had
already begun (for further information please see "Courts
consider confusion surrounding foreclosures").
Consequently, the 2014 amendments failed to achieve the desired
outcome of reducing non-performing debt. With Cypriot banks'
non-performing loans still at 43% of total borrowing (the second
highest in the European Union following Greece), Parliament has
decided on additional reforms.
