The amended Sale of Property (Specific Performance) Law (Law N. 132(I)/2023) came into force on 12/12/2023 to protect the purchaser’s interests. The Law applies to Contracts signed on or after 12/12/2023 and provides for a mechanism to safeguard the interests of the purchaser.
In relation to properties subject to existing mortgages or prior lodged agreements, the submission of a Contract to the Land Registry is now conditional to the provision of either a “Type A” or “Type C” written declaration.
Pursuant to Type A written declaration, the purchaser and/or the seller can deposit an amount equal to the 95 per cent of the consideration of the Contract into a bank account of the seller and as a result, the mortgage lender, by countersigning the written declaration Type A, undertakes to remove or release the said mortgage.
On the other hand, the purchaser has the option to submit the Contract to the relevant District Land Registry, without it being accompanied by the written declaration Type A by submitting the Contract with written declaration Type C which confirms that the purchaser is aware of the existing mortgage.
The Law also provides that, for Contracts concluded on and after 12/12/2023, the Seller is obliged to attach, as an integral part of the Contract, a Search Certificate of the immovable property, detailing any encumbrances on the property being sold, which shall not be dated more than five (5) working days from the date of signing of the Contract. In addition, discretionary authority is given to the Director of the Department of Lands and Surveys, to impose administrative fines on the Seller and/or the Mortgagee in cases of non-compliance with specific provisions of the new amending Law.
For further information on this topic please contact
Mrs. Maria Pitta( mariapitta@pittaslegal.com ) at SOTERIS PITTAS & CO LLC,
by telephone (+357 25 028460) or by fax (+357 25 028461)
The content of this article is intended to provide a general guide to the subject matter. Specialist advise should be sought about your specific circumstances.
