Property claims

Mortgaged propertyWhen your lawyer carries out a Title search at the Land Registry (see Property Conveyancing) he/she may discover that the property you are thinking of buying has been mortgaged.

As well as a mortgage, your lawyer may find other claims, known as liens and liabilities burdening the property. The general name for these is "encumbrance" and they have the same effect as a mortgage inasmuch as they prevent you from owning the property until the claim has been removed by the person or company that lodged it.

When a property developer mortgages the land on which he is building, the bank that loaned the money lodges a claim against the land as security for the repayment of the debt. This gives the bank the right to sell the land (an anything on it) to recover its money. The encumbrance will be removed once the mortgage has been repaid.

Due to the archaic property laws and 'bent' lawyers and property developers, many people only discover that the property they have bought is mortgaged when the bank decides to recover its money. One unfortunate person who found himself in this position is Roger Snelling. Roger lives in Pissouri and you can hear and see how he was conned in Andrew Winter's damning documentary, a clip from which you can see on the right.

In August 2011, the Cyprus Government introduced a series of measures designed to provide buyers with added protection and to help them to avoid ending up in situations like that of Roger. For more information on these measures, please refer to New specific performance law increases safeguards.

Claims lodged against property in Cyprus

The most common types of property claims (encumbrances) are:

In addition to encumbrances, there may also be a "prohibition" lodged against the property. Prohibitions prevent the property owner from transferring or mortgaging any of his property and include:

If your lawyer uncovers a mortgage or any other claims lodged against the property you are thinking of buying, it is absolutely essential that they discuss them with you and advise you how best to protect your interests.