Panayiotis Rougalas
Cyprus’ long-running effort to reform its foreclosure system has taken a sharp turn, with President Nikos Christodoulides approving only three out of 12 new laws passed by parliament.
According to the Presidency, five of the laws were sent back to the House for reconsideration, while four others were referred to the Supreme Court for constitutional review.
The remaining three were signed into law after being judged legally sound and workable in practice.
Speaking on public broadcaster RIK, Presidential Press Office Director Viktoras Papadopoulos said the approved measures were the ones that could be applied effectively without legal or operational issues.
Among them are two government-backed bills and one proposal from the Green Party, which sets a key safeguard: property auction prices cannot be pushed below 50% of a home’s market value.
The approved reforms also significantly expand the role of the Financial Commissioner. Under the new framework, the Commissioner gains stronger tools to review and confirm debt disputes, including the ability to restructure debt and issue binding decisions of up to €20,000 against financial institutions.
In practical terms, borrowers will now be able to challenge their debt earlier in the process, right after receiving the first notification letter, instead of waiting for a later stage.
One of the more impactful changes is the ability for borrowers to temporarily suspend foreclosure proceedings on primary residences valued up to €350,000 while the financial commissioner reviews the debt.
The idea is to give struggling homeowners a breathing space before losing their property.
If no agreement is reached between borrower and lender after this process, the borrower can also turn to an insolvency advisor to explore restructuring options, including a personal repayment plan.
Taken together, the reforms aim to create a more structured pathway for resolving debt disputes, balancing foreclosure procedures with new safeguards for borrowers.
However, with several laws now sent back or under constitutional review, the final shape of Cyprus’ foreclosure framework is still far from settled.
