Filenews 14 December 2025 - by Eleftheria Paizanou
The Court of Foreclosures has remained only in words and on paper for two years since the decision of the Parliament. Following the adoption, in December 2023, of the much-publicised legal framework for the establishment of the Special Jurisdiction for non-performing loans, the law has not yet been implemented.
Borrowers could appeal to the Foreclosure Court to shield their main residence, worth up to €350,000, from the sale, however, the Supreme Court considered that the conditions still do not allow the law to be applied.
It is worth noting that the legislation passed by the Parliament does not oblige the Supreme Court to proceed with the establishment of a Foreclosure Court, as this provision is optional!
However, citizens, taking advantage of the previous legislation, can go to court for loan repayments or dispute loan agreements.
Due to the non-functioning of the much-discussed Foreclosure Court, the Ecologists are bringing back the debate on the right of citizens to appeal to justice. The proposed law also includes provisions that protect citizens from the abusive clauses found in loan agreements.
Last Thursday, the Ecologists submitted a proposal for a law to the Plenary Session of the Parliament, which ensures the right of the mortgage debtor, as well as other interested persons, to appeal to a competent court for the suspension of property sale procedures in specific cases, which are determined and include the disputing of the amount due and the invocation of the existence of unfair terms in loan or mortgage contracts.
The draft law, signed by the president of the Ecologists, Stavros Papadouris, applies "in the event that any lawsuit or appeal proceedings against a court decision or application for setting aside issued in favour of a licensed credit institution or former cooperative credit institution or credit acquiring company or credit facility administrator are pending before a competent court. decision, in which proceedings are disputed either the contestation of the amount due or the invocation of the existence of unfair terms in the loan or mortgage contracts or the invocation of any other illegalities or due to the invalidity of the loan and mortgage agreements".
At the same time, it is provided that no new warning letter for the intended sale of mortgaged property can be served on the borrower until a final decision is issued on the merits of the dispute on all legal remedies.
In fact, in the event of a court decision in favour of the mortgage lender and against the debtor, the latter has the right to file an application for setting aside the court decision, when it is the result of unfair terms, either in the loan agreement or in the mortgage.
As the rapporteur argues, the proposed arrangements will be implemented, regardless of whether any notices were sent to the mortgage debtor or other interested persons, in accordance with the provisions of the Basic Law that regulate the sale of mortgaged property by a mortgage lender before the entry into force of the law.
With the new year, the Ecologists will demand that the proposed law be put under the microscope of the parliamentary Finance Committee, with which it is a given that the Central Bank, the Association of Banks and the Association of Credit Acquiring Companies will disagree. Perhaps the Ecologists will find "allies" from other parties, however, it is most likely that DISY and DIKO will disagree.
