Cyprus-Forum.com

[hincyprus]

Off the thread but at least I now know what PHd's do with their time......

Some of us must get back to the grind and it is too hot to be working. (sorry Cyprus Tax man) Retired.

H

[Steve & Dawn]

Can someone tell me what differnce does it make if your developer is registered. How can you check?

[hincyprus]

Hi,

By Cyprus Law a developer must be registered by the Cyprus Government.

I do not know the exact criteria but I can find out from my son if you wish.

I do know that he had to go through due process at the time of registering his company.

If he wished to form the same company today , it would not be allowed as it is a restricted "opportunity" following the EU accession.

He also had to have a certain amount of money available at the time of formation of the company and it was not chicken feed.

The reason for the big clampdown was the fact that any Tom Dick or Harry could call themselves a developer and build on their own or other land.

My son has his own architects, quantity surveyor etc etc.

Hope this answers your question but I will happily find out more if you wish.

but whilst I am in full flow, here is a piece of information that is little known to buyers here in Cyprus.

For example, a developer or builder owns a piece of land and builds one house or 20 houses. When the development is, lets say, finished or even part finished the value of the land/plots has already risen.

The developer can approach his bank and borrow against the land and properties on the land.

Therefore, you may move into your brand new house, having paid all your money and you await the title deed.

If, when the deeds are ready for transfer the developer/builder still has his loan on the properties the deeds cannot transfer.

This is one of the main reasons that deeds are delayed as the developer does not complete the process knowing he has an outstanding debt to repay if the deeds are issued.....................................

Only the developer can ask for the Land registry to complete that plotting process on your behalf.


Bet non of you knew this ruse !!!!!!!!!!!!

H

[Svetlana]

Hi Steve and Dawn

To become a developer it is required to be registered here, but it is a mere formality and does not provide any assurance, in my view.
The irony is it takes a week to become registered as a Developer but eight years to become registered as an Estate Agent.

It does make a difference if your Estate Agent is registered or not; they are bound by a Code of Conduct and must have professional Indemnity Insurance. If you sell through a registered Estate Agent, you can set their commisssion against your Capital Gains Liability, otherwise not.
To operate as an Estate Agent in Cyprus, companies are required to be licensed, by law. In the event the majority of Estate Agents here are not and are working illegally.

Lana

[Svetlana]

Hi Hincyprus

But as a Purchaser, your lawyer can, and should, find out via Land Registry whether there is an 'encumbrance' (mortgage/debt) on the land before the Puchase Contract is signed. Subsequently, once the Lawyer has registered the plot under 'Specific Peformance' at Land Registry on the Buyer's behalf, no further mortgage can be taken out on the land, this should never happen.

Of course, if the buyer does not use a decent lawyer....


Lana

[hincyprus]

Sorry you are wrong.

I know of several builders/developers where the houses are mortgaged by the purchasers and they have moved in to the property.

This does not stop the builder/developer still borrowing against the development as in theory he is still the legal owner.

H

[Svetlana]

Hi Hincyprus

The following is an outline of the law relating to Specific Peformance which categorically states that, following Specifc Peformance, no mortgage can be taken out. I regret you are wrong about me being wrong

The Sale of Land (Specific Performance) Law

Under this law a purchaser of immovable property may secure the remedy of specific performance, by depositing a duly stamped copy of the contract with the Land Registry within 2 months from the date of the execution thereof, thus preventing the vendor from transferring property elsewhere or charging it for as long as the contract is valid and legally effective.

Once the sales agreement is signed and a deposit of 30% paid, the contract is deposited at the Land Registry to protect the purchaser’s ownership rights until issuance and transfer of the title deeds into your name. This cannot be withdrawn by anyone and ensures no one but the purchaser can lease, sell, transfer, or mortgage the property.

Lana

[hincyprus]

Hi Lana,

Thank you for that. (I am sorry).........................

How then do you explain a development of nine properties, all sold and occupied, where the developer has informed all the owners that he has just taken out a bank loan against the development to fund his next project?

I will be very interested to know how they are doing it.

Regards

H

[Svetlana]

Hi hincyprus

Ok, several possibilites, in decreasing order of likelyhood:

i) he is not telling the truth or it is a rumour put round by someone else (as you know, in Cyprus, rumours grow more quickly that grapes!).


ii) The purchasers did not have a lawyer - or worse used the developer's 'free' lawyer - or had an incompetent lawyer.

I suggest you (or they) contact their lawyer to ask what is going on! The lawyer is paid to protect clients from this very situation.

Let's hope the developer had a Building Permit and Planning Permission! or there could be a very long wait for Title Deeds!


I believe, in the longer term, there is one remedy, with the developer's co-operation. When the TD become available - or at least when the Municipality issue the Certificate of Compliance - the Bank will, or may, be prepared to release the TD for an individual plot, if a corresponding percentage of the loan is paid off. But getting the developer and the Bank to fall in with this is not easy.

HTH

Lana

[hincyprus]

Thanks.

Luckily I am not in that situation. I am on a single plot and our arguement happens to be about false extras, work not done, and incorrect fitments etc etc.

We have a small boundary problem but an official measurement will sort that one.

We are still going to court though as our developer is totally intransigent so I am going for him big time.

Know any really good lawyers

Regards
H