{"id":565,"date":"2024-05-31T12:44:55","date_gmt":"2024-05-31T09:44:55","guid":{"rendered":"https:\/\/financialombudsman.org.cy\/interpretative-circular-of-the-financial-committee-on-the-method-of-determining-the-estimated-value-of-the-main-residence-or-commercial-property\/"},"modified":"2025-05-15T09:31:47","modified_gmt":"2025-05-15T06:31:47","slug":"fc-2024-1","status":"publish","type":"post","link":"https:\/\/financialombudsman.org.cy\/en\/fc-2024-1\/","title":{"rendered":"Interpretative circular of the Financial Committee on the method of determining the estimated value of the main residence or commercial property"},"content":{"rendered":"

[vc_row][vc_column][vc_column_text css=””]<\/p>\n

CIRCULAR NO : 1\/2024<\/h3>\n

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The Financial Commissioner issues this Interpretative Circular, which shall be referred to as “the Financial Commissioner’s Interpretative Circular on how to determine the assessed value of a principal residence or commercial property”<\/strong><\/em>, in which the Commissioner determines the manner in which a decision is made on how the criterion of the assessed value of the principal residence or business premises is met.<\/span><\/p>\n

2. Because, pursuant to Article 14A of the Law on the Establishment and Operation of the Unified Body for the Out of Court Settlement of Financial Disputes 2010, as amended and\/or replaced from time to time:<\/p>\n

“credit facility” means-<\/span><\/strong><\/em><\/p>\n

(a) a loan or overdraft limit or credit card limit for a total contractual obligation up to the amount of three hundred and fifty thousand euros (\u20ac350.000), originally issued by a credit institution to a debtor and\/or modified and\/or replaced and which is secured by a mortgage or a security assignment agreement filed with the Department of Land Registry and Surveying on real estate used as a principal residence or as a business premises, the estimated value of which does not exceed three hundred and fifty thousand (\u20ac350,000) euros and seven hundred and fifty thousand (\u20ac750,000) euros respectively; or<\/span><\/strong><\/em><\/p>\n

(b) the leasing of real estate, used as a main residence or as a business premises, the estimated value of which does not exceed three hundred and fifty thousand (\u20ac350,000) euros and seven hundred and fifty thousand (\u20ac750,000) euros respectively, with a total contractual obligation up to the amount of three hundred and fifty thousand euros (\u20ac350,000).<\/span><\/strong><\/em><\/p>\n

It is understood that the valuation of the value of the main residence or commercial property is carried out by a valuer who is a member of the Cyprus Chamber of Science and Technology.”<\/span><\/strong><\/em><\/p>\n

3. Therefore, the Financial Commissioner for the purpose of accepting an application for the appointment of an ombudsman for the purpose of restructuring credit facilities, will be satisfied for the fulfilment of the criterion of the estimated value of the main residence (up to \u20ac350,000) or the commercial property (up to \u20ac750,000) as follows:<\/span><\/p>\n

i. <\/span>By a valuation carried out within two (2) years prior to the submission of <\/span>the application, as referred to above, in the context of the application of the provisions <\/span>of the Code for the treatment of borrowers facing financial difficulties <\/span>difficulties on the Arrears Management Directive of the Central Bank<\/span>\u00a0of Cyprus, or<\/span><\/p>\n

ii. <\/span>With valuations carried out within two (2) years, prior to the <\/span>the submission of the application, as referred to above, within the framework of the application of the provisions of Article 44D of the Real Estate Transfer and Mortgage Law of 1965, as amended and\/or replaced from time to time, or<\/span><\/p>\n

iii. <\/span>By any other valuation carried out within two (2) years prior to the <\/span>submission of the application, as referred to above, jointly between the debtor and the authorised institution or credit purchaser under any other legislation and\/or directive by the competent supervisory authority; or<\/span><\/p>\n

iv. <\/span>In the event that there is no valuation, in accordance with the above, the average of the assessments carried out, within two (2) years, <\/span><\/span>prior to the submission of the application and submitted separately by the parties concerned shall be taken into account:<\/span><\/p>\n

It is understood that each party involved (the applicant and the licensed institution or credit buyer) will have to provide a valuation and if the difference in market value between the two valuations does not exceed 25%, the average will be taken into account. If the discrepancy exceeds 25%, then a third valuation will be carried out through the ETEK and the appraised value will be determined by the average of the two closest appraisals. <\/span><\/p>\n

It is further understood that the valuers who will prepare the valuations in any of the above cases must be members of the Cyprus Scientific and Technical Chamber (CTEK).<\/span><\/p>\n

It is further provided that, where the debtor does not provide a valuation, only the valuation of the licensed institution or credit purchaser shall be taken into account.<\/span><\/p>\n

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