By George Psyllides
RULING DISY is prepared to submit a bill to exempt primary residences from foreclosure until April 3 pending discussion of the fifth and final piece of legislation that is part of the insolvency framework.
Opposition parties have suspended implementation of the foreclosures law until the framework, seen as a safety net for crisis-stricken vulnerable groups, came into force.
The suspension expires on March 19 but the insolvency framework was not ready in its entirety.
MPs have discussed four of the five bills and DISY and DIKO are reportedly going to try to put them to the vote this week. AKEL and EDEK disagree and they want all five bills to be put to the vote together.
DISY’s proposal is seen as an effort to allay concerns that banks would go after people’s homes if the foreclosures law was enforced.
“What will happen with these five bills will be decided in tomorrow’s joint sessions of the House Finance and Interior Committees,” finance committee chairman Nicolas Papadopoulos said.
Asked whether his party would support DISY’s proposal, Papadopoulos emphasised the need for approval of the framework as soon as possible otherwise people will go to jail.
“I’m not speaking metaphorically, I am being literal, because some people unfortunately formed a wrong impression, that because we suspended the law on foreclosures, loans were also suspended,” he said.
Foreclosures were not the only way banks could use to collect their money, he added. He said bankruptcy, liquidation, and asset seizures could also be used.
“Those who claim we should not pass the insolvency framework must explain what we will do to stop banks putting people in prison,” he said.
“The framework must be approved as soon as possible if we want to protect borrowers.”
EDEK MP Nicos Nicolaides said his party wanted to see a comprehensive law, suggesting that his party may be pushing for further suspension of the foreclosures law because there was no time to examine all the pending matters.
DIKO and AKEL may also submit proposals suspending foreclosures when it comes to properties, which are paid for but have no title deeds because the developer cannot make his mortgage payments.
In such cases, the developers’ land and buildings are counted as assets that need to be offset against their debt to banks, which gives lenders a claim on people’s properties that had been mortgaged by the developers even if the purchasers had paid in full.
Under its bailout terms, Cyprus has until the end of May to determine the size of the problem and propose solutions.
