Cyprus financial ombudsman seeks legal changes to assist debtors in foreclosure cases

The Cyprus Financial Ombudsman reports significant public confusion regarding the office's jurisdiction, which often prevents citizens from seeking necessary help. The Ombudsman investigates complaints against banks, credit acquisition companies, and insurance or investment firms concerning contractual disputes. Since 2023, the office has had the authority to verify debt amounts specified in notices sent by financial institutions. However, the Ombudsman cannot intervene in cases where a court decision has already been issued, a situation that applies to approximately 50% of current foreclosures. To address this, the Ombudsman has requested a legislative amendment from Parliament to allow for a three-month mediation period after a court ruling. Under the current legal framework, debtors are required to pay the full outstanding amount immediately after a judgment is rendered. Data shows that the office handled approximately 100 requests for primary residences in 2024 and 197 cases in 2025. Projections indicate a further increase in foreclosures for 2026 as applications for the mortgage-to-rent scheme are finalized and processed.