Buying a resale without deeds and awaiting a waiver.

Do you have a problem getting your Title Deeds?
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Andrew123
Posts: 3
Joined: 10 Jun 2014 14:11

Buying a resale without deeds and awaiting a waiver.

Post by Andrew123 » 10 Jun 2014 17:17

I have a question about buying a resale property without deeds whilst waiting for a bank waiver on a developer loan that is apparently cleared. Whilst not ideal, we risk the purchase falling apart if we wait any longer and it is a relatively inexpensive purchase. I simply want to quantify the level risk before deciding what to do.

What I need to know is whether my exposure to any outstanding developer loan will go beyond the price I pay for the property. In other words, would savings and property in the UK be at risk, or would I simply be risking the amount I pay? The sellers have a waiver but as I understand it,they cannot simply staple the waiver to the assignment agreement and expect it to cover us.

Verbal assurances have been given by the bank that the loan is actually cleared even though it is still showing on the land registry search. I'd no idea why this would be the case, although I just read that it may be due to facilitating the developer to act as guarantor on any customer mortgages . The bank involved is ex-Laiki and I'm told they did this often.

Completion cert was issued October and checks on the developer suggest he has relatively decent financial standing.



Nigel Howarth
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Re: Buying a resale without deeds and awaiting a waiver.

Post by Nigel Howarth » 11 Jun 2014 09:23

Hello Andrew and welcome to the forum.

Your risk will be limited to whatever you pay for the property - plus your legal fees, etc. You will not be liable for any debt the developer may have. But if he doesn't pay the Immovable Property Tax and/or Capital Gains Tax he owes on the property, you will probably have to pay this if you want to secure Title.

Also if there are any memos lodged against the property you will need a court order to get them removed if the creditor is unwilling to remove it from the property you are purchasing.

The antediluvian system here requires a developer/landowner to take a small mortgage on the land on which he is building if his customer's need a loan to purchase a property built on that land. This enables the lender to recover the property should the buyer default on their loan repayments. Also, the amount shown on the Land Registry search certificate is the is the amount of the mortgage agreement, not the balance of the mortgage outstanding - only the bank has that information and as it is confidential the bank will not release the details to you. It's damn stupid system - a Land Registry search could show a mortgage of (say) €100,000, but the actual debt could be many times that figure if the developer hasn't been repaying the mortgage (you've probably read about the billions of non-performing loans).

The waiver is issued to the person(s) buying the property and is not transferable to a 'new' purchaser. I cannot see why the bank would refuse to provide you with a waiver as well.

Regards,


Nigel Howarth
Independent information & advice for Cyprus property buyers
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Andrew123
Posts: 3
Joined: 10 Jun 2014 14:11

Re: Buying a resale without deeds and awaiting a waiver.

Post by Andrew123 » 11 Jun 2014 09:38

Many thanks, Nigel. You've been a great help as ever. It's been a few years but your advice helped us greatly on our first purchase. This time I've chosen a far better lawyer and do be a bit more homework. I really appreciate your clarification.



Nigel Howarth
Site Admin
Posts: 2275
Joined: 24 Oct 2007 14:38
Location: Erimi, Limassol, Cyprus
Contact:

Re: Buying a resale without deeds and awaiting a waiver.

Post by Nigel Howarth » 11 Jun 2014 18:07

You're welcome Andrew - pleased to hear I was able to help a few years ago.

Regards,


Nigel Howarth
Independent information & advice for Cyprus property buyers
Contact Nigel Howarth
Read the latest Cyprus property news

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