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Cyprus pushes back property misselling deadline for expat victims
| Published: | 18 Dec at 6 PM |
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Whilst the bulldozers continue demolishing mis-sold expat homes in Spain, those unfortunates in a similar position in Cyprus have been given more time to launch legal proceedings.
Thousands of investors and retirees who emigrated to the popular island have now been given by the Cyprus government another 12 months in which to launch lawsuits against banks and corrupt property developers. The deadline will now extend until the end of December 2014.
The many Britons who chose Cyprus as their retirement destination as well as investors in overseas properties make up the total of around 15,000 homes purchased between 2003 and 2009. A good number bought off-plan, with building work unfinished or not yet begun.
Unlike in the Spanish property scandal, Cyprus mis-selling claims mostly relate to mortgages and currency fluctuations over the period. Purchasers were duped by banks and developers into Swiss franc–based loans by pushing currency stability and llow interest rates.
After the 2008 crash, the Swiss franc soared a massive 40 per cent against the euro, causing the banks to hike mortgage rates. At the same time, Cypriot real estate values slumped by around 70 per cent, leaving borrowers and investors in serious negative equity.
Many now face financial ruin, as mortgage rates have doubled and tripled, leaving them in debt to the banks. Worst affected are those who emigrated to Cyprus for work reasons or retirement, and others who have made buy-to-let property investments as their potential retirement homes. Some of those taking legal action are arguing that banks did not alert them to the possibility of large-scale currency fluctuations, and others accuse Cypriot solicitors of using invalid powers of attorney to commit them to loans different to those marketed.
Developers used title deeds on their properties as collateral for loans, meaning the homes could be sold to pay off developers’ debts. Others failed to deliver the homes as promised, or refused to provide amenities included in their sales pitch.
Thousands of investors and retirees who emigrated to the popular island have now been given by the Cyprus government another 12 months in which to launch lawsuits against banks and corrupt property developers. The deadline will now extend until the end of December 2014.
The many Britons who chose Cyprus as their retirement destination as well as investors in overseas properties make up the total of around 15,000 homes purchased between 2003 and 2009. A good number bought off-plan, with building work unfinished or not yet begun.
Unlike in the Spanish property scandal, Cyprus mis-selling claims mostly relate to mortgages and currency fluctuations over the period. Purchasers were duped by banks and developers into Swiss franc–based loans by pushing currency stability and llow interest rates.
After the 2008 crash, the Swiss franc soared a massive 40 per cent against the euro, causing the banks to hike mortgage rates. At the same time, Cypriot real estate values slumped by around 70 per cent, leaving borrowers and investors in serious negative equity.
Many now face financial ruin, as mortgage rates have doubled and tripled, leaving them in debt to the banks. Worst affected are those who emigrated to Cyprus for work reasons or retirement, and others who have made buy-to-let property investments as their potential retirement homes. Some of those taking legal action are arguing that banks did not alert them to the possibility of large-scale currency fluctuations, and others accuse Cypriot solicitors of using invalid powers of attorney to commit them to loans different to those marketed.
Developers used title deeds on their properties as collateral for loans, meaning the homes could be sold to pay off developers’ debts. Others failed to deliver the homes as promised, or refused to provide amenities included in their sales pitch.
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