Newsroom
The government of Cyprus is stepping up to help homeowners struggling with rising interest rates and inflation. In a recent meeting at the Presidential Palace, President Nicos Christodoulides and the Council of Ministers approved a new Mortgage Interest Rate Subsidy Scheme designed to give households some financial relief.
The scheme aims to ease the financial pressure caused by increased interest rates and inflation, specifically for homeowners who took out mortgages in the past two years. By offering a subsidy on mortgage interest, the government hopes to reduce the strain on disposable income for affected households.
To benefit from this scheme, you must meet the following conditions:
- You’ve signed a mortgage loan agreement between January 1, 2022, and December 31, 2023.
- The loan is for purchasing or building a primary home (including land purchase) and not for refinancing or restructuring a previous loan.
- Your mortgage must have a variable interest rate.
- The total loan amount must not exceed €400,000.
- Your annual family income must not exceed €50,000.
- You must have settled or arranged your 2023 or later tax debts with the Tax Department.
How does the subsidy work?
The scheme will cover 50% of the difference between the average total interest rate during the reporting period and the interest rate at the time your loan was issued.
The maximum subsidy is capped at 2 percentage points (200 basis points).
The subsidy lasts for a maximum of two years from the date of your first loan disbursement.
When and how to apply
Applications will open on January 2, 2025, and will be accepted for two months. You can find the terms of the scheme, the application form, and a detailed guide on the General Accounting Office’s website. Applications can be submitted at Citizen Service Centers (CCPs) and District Post Offices (CCPOs).
The European Commission has confirmed that the scheme complies with regulations and does not constitute State aid. The General Treasury has allocated funds to cover the subsidy for the next three years:
€12 million for 2025
€11 million for 2026
€10 million for 2027
Part of a bigger support plan
This mortgage subsidy scheme is part of a broader package of measures aimed at protecting households from the effects of rising prices and inflation. The government continues to explore ways to ease financial pressures and support citizens during these challenging economic times.
[With information from Official Government gazette]
