Members of the Cyprus Parliament have called for urgent changes to legislation on forced property sales. The trigger was numerous complaints from borrowers and guarantors who, according to parliamentarians, are effectively deprived of adequate legal protection under the current rules. At the center of the discussion is the balance between the interests of banks and the basic rights of citizens facing the risk of losing their homes or businesses.
AKEL MP Aristos Damianou stated at a meeting of the House of Representatives finance committee that his party has been seeking for more than ten years to restore fairness in a system where the advantages of credit institutions and non-performing debt management companies clearly outweigh borrowers’ rights. He emphasized that a key right remains unhindered access to justice, which would allow the suspension of the sale of primary residences or small commercial premises in cases of disputed debt amounts or the presence of unfair terms in loan agreements.
Evictions and social resonance
According to Damianou, current legislation has already led to extreme situations. He recalled that even during the Christmas holidays people continued to lose their homes due to accelerated confiscation procedures. In his view, this indicates that the social dimension of the problem is being ignored, while opposition proposals are not receiving proper consideration. AKEL insists that draft laws prepared by various parties be brought to discussion no later than February.
The urgency of reforms was also supported by Green Party chairman Stavros Papadouris. He pointed to a clear imbalance between the speed of auctions and the possibilities for judicial protection. In practice, forced property sales in Cyprus can be completed within a year, while court proceedings to determine the lawful amount of debt often take 7–9 years. Under such conditions, borrowers effectively lose the chance to defend their rights before losing their property.
Political confrontation and elections
Discussion of the reforms has once again intensified tensions in Parliament. MPs from the DISY and DIKO parties oppose new taxes for banks and changes to confiscation laws. They continue to defend the 2023 legislation that provided for the creation of a special court for forced sale cases. However, the key provision allowing the Supreme Court to effectively launch such a court remains non-mandatory, limiting the real ability of borrowers to seek protection.
Parliamentary committees had previously raised this issue. Last autumn, the refugees committee called on credit companies to temporarily suspend confiscation procedures to give vulnerable borrowers time for negotiations. At that time, a warning was issued that in the absence of dialogue Parliament would be forced to intervene at the legislative level.
What changes are being proposed
The current draft laws aim to restore borrowers’ right to challenge auctions, limit abuses in loan agreements, especially regarding guarantors, and strengthen judicial oversight. At the same time, the authors of the initiatives emphasize that this is not about undermining the stability of the financial system. Licensed credit institutions, according to MPs, have sufficient liquidity and do not require urgent recapitalization.
Against the backdrop of approaching elections, the issue of confiscations and housing protection is becoming one of the key topics on the political agenda. Opposition forces call for unity against what they describe as excessive influence of the banking lobby, while supporters of the status quo warn of risks to financial discipline. It is clear that in the coming months the issue of changes to confiscation laws will become one of the most acute and widely discussed topics in Cyprus.