Panayiotis Rougalas
A new window is reopening for Cyprus’ “Mortgage to Rent” scheme, with the Finance Ministry announcing that applications will once again be accepted for vulnerable borrowers struggling with non-performing loans tied to their primary homes.
Applications will open on Monday, May 4, 2026, and remain open until Friday, July 31, 2026.
The relaunch comes at a time when Cyprus’ foreclosure framework has once again come under public and political scrutiny, with lawmakers discussing changes aimed at strengthening protections and support measures for vulnerable borrowers.
The scheme is designed to help socially vulnerable homeowners whose primary residence has been used as collateral for a non-performing loan.
KEDIPES, the state-backed asset management company responsible for implementing the scheme, confirmed the reopening, echoing reports first published by Kathimerini in March about plans to bring the program back.
The decision to reactivate the scheme follows months of discussions at the House Finance Committee, where MPs examined ways to improve the foreclosure framework and expand support tools for financially vulnerable households.
Who qualifies
The scheme concerns non-performing loans secured against a borrower’s main residence, provided the home has a market value of up to €250,000.
Eligible applicants include individuals receiving specific state benefits, as well as borrowers deemed eligible but financially non-viable under the earlier Estia and Oikia housing support schemes, which covered primary residences valued at up to €350,000.
The program also covers people whose participation in the Estia or Oikia schemes was terminated.
Following a Cabinet decision on April 3, 2024, eligibility was expanded to include two additional categories linked to the Estia scheme:
- borrowers whose lenders did not participate in Estia, and
- applicants who had been approved for Estia but whose applications could not be completed because property owners were unable to clear legal charges or encumbrances (“memo”) placed on the property by creditors.
How the scheme works
Under the process, the property first undergoes a technical suitability inspection and market valuation.
KEDIPES then acquires the borrower’s primary residence and pays the participating bank or credit-acquiring company roughly 65% of the property’s market value.
Any remaining debt not covered by other collateral is written off by the lender.
The Republic of Cyprus then pays KEDIPES rent amounting to 65% of the market rental value, while the former homeowner remains in the property as a tenant.
The rental period lasts for 14 years, or for life in cases where the tenant is over 65 years old.
Tenants also retain the right to buy back their home after five years and before the end of the 14-year lease period, at a pre-agreed price set out in the rental contract.
Officials say the repurchase price is calculated using several factors, including changes in property prices, rental payments, and related expenses, with the aim of keeping the option financially attractive for tenants hoping to eventually regain ownership of their home.
