Cyprus: Scheme to protect primary residences unsuccessful

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The government-backed scheme which was created to protect primary residences has been unsuccessful.

The initiative was intended for subsidising mortgage payments for those who have been affected by unemployment or a reduction in income. Moreover, it was due to be put into action by the Cyprus Land Development Corporation (Koag).

When the scheme first came about, officials assessed that it would benefit about 200 households.

The scheme involved housing loans which the primary residence has been put up as collateral with the lender. The lender would have been operating under a licence from the Central Bank of Cyprus.

Following this, the scheme concerns residences that have a market value of EUR €250,000 or less (plus VAT) and the outstanding loan amount cannot be more than EUR €300,000. Beneficiaries may have up to 60% of their monthly mortgage instalment subsidised for maximum three consecutive years. Along with this, the subsidy covers payments on the interest and the principal.