Loan Restructuring in Cyprus, Unraveling Unlawful Charges, and Confronting Mortgage Foreclosure

Cyprus banking law is an intricate field, influenced by national legislation, European Union (EU) directives and regulations, and relevant case law. This article offers a comprehensive analysis of Cyprus banking law, with a particular focus on our law firm’s expertise in loan restructuring, identifying unlawful charges, and managing the mortgage foreclosure process. We will discuss the applicable legal framework and demonstrate how our team collaborates with financial advisors to secure favourable outcomes for our clients in the ever-evolving banking sector in Cyprus.

Loan Restructuring and Out-of-Court Settlements

Loan restructuring is an essential aspect of banking law in Cyprus, as it helps borrowers avoid foreclosure and maintain financial stability. Our law firm represents clients in negotiations with credit institutions or investment funds to settle disputes concerning credit and other financial services. Our objective is to reach out-of-court settlements or reorganise loans to prevent mortgage foreclosures.

The legal framework guiding loan restructuring includes Cyprus’ Insolvency Law of 2015 (L. 63(I)/2015), which outlines a structure for out-of-court debt reorganisation. Additionally, EU directives and regulations significantly impact Cyprus’ banking sector’s legal environment. The EU Directive 2014/59/EU on Bank Recovery and Resolution and the EU Regulation No. 806/2014 on the Single Resolution Mechanism provide guidance for out-of-court settlements and restructuring processes.

It is vital to understand the eligibility criteria and procedural requirements for loan restructuring under the Insolvency Law of 2015. Eligible borrowers must demonstrate financial difficulties and a genuine intention to cooperate with creditors. Additionally, the restructuring plan should be viable, ensuring that the restructured loan can be repaid within a reasonable timeframe.

Identifying Unlawful Charges and Legal Representation

Banks may sometimes impose unlawful charges on borrowers, which can significantly affect their financial standing. Our law firm collaborates with esteemed financial advisors who specialise in examining client accounts and detecting unauthorised charges. These professionals bolster our legal services by offering detailed and organised testimony rooted in European Central Bank Directives, Court of Justice of the European Union (CJEU) judgments, and European Directive 93/13 on Unfair Terms in Consumer Contracts.

Our law firm provides legal representation for clients affected by unlawful charges, handling negotiations with banks, or submitting a lawsuit or a defence/counterclaim in court to assert our clients’ rights effectively. We analyse the charges, gather relevant evidence, and develop a strong case based on the applicable legislation and case law, ensuring the best possible outcome for our clients.

Navigating Mortgage Foreclosure Procedures and Auction Suspensions

Mortgage foreclosure is a challenging process for borrowers, often resulting in the loss of their property. The 2014 legislative amendments introduced new regulations on private auctions and mortgage foreclosure procedures in Cyprus, necessitating compliance with Notice Letters of Type «Θ», «Ι», and «ΙΑ». Our law firm provides legal counsel on these procedures, submits filings on behalf of our clients, and acquires decrees to halt auctions within judicial proceedings.

The Transfers and Mortgages Law (Cap. 9) governs mortgage foreclosure procedures in Cyprus, while European Union law principles and CJEU case law play a crucial part. The CJEU case of Aziz v. Caixa d’Estalvis de Catalunya, Tarragona i Manresa (C-415/11) highlighted the significance of consumer protection in mortgage enforcement proceedings and the requirement for national legislation to align with EU law. Our team stays abreast of the latest developments in EU law and CJEU judgments to ensure our clients receive accurate and up-to-date advice.

When representing clients in mortgage foreclosure cases, we meticulously review their circumstances, identify potential legal defences, and develop a comprehensive strategy to prevent or delay the foreclosure process. Some possible defences include procedural errors, violation of consumer protection laws, or the application of the Unfair Contract Terms Directive.

Collaborating with Financial Advisors for Optimal Outcomes

Our law firm’s collaboration with financial advisors is crucial for achieving the best possible outcomes for our clients. These advisors possess in-depth knowledge of the banking sector and can identify irregularities, unlawful charges, and potential restructuring opportunities. By working together, we can build strong cases, negotiate effectively, and provide well-rounded legal and financial advice for our clients.

Financial advisors also play a vital role in gathering evidence and providing expert testimony in court. Their insights and analyses are invaluable when presenting a case, as they can highlight inconsistencies, breaches of regulations, and potential violations of the law by the banks or other financial institutions.

Understanding the complexities of banking law in Cyprus requires comprehensive knowledge of national legislation, EU directives, regulations, and case law. Our law firm is committed to offering clients expert legal representation and current advice on loan restructuring, identifying illegal charges, and mortgage foreclosure procedures. By working closely with seasoned financial advisors, we can ensure the most advantageous results for our clients in their disputes with banks and other financial institutions. As the legal landscape continues to evolve, we remain dedicated to staying at the forefront of developments to provide our clients with the highest level of service and expertise.  Contact us today for a free no obligation consultation.