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How Important are your Title Deeds?

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The acquisition of a Title Deed is usually simple and straightforward, however, at times it can also involve a very complex and specialised process which understandably is not always very clear to the average person. Nevertheless, a Title Deed is a very important legal document which is used as evidence of proof of ownership and of who holds the title to an immovable property, such as a home or a plot of land. With regards to immovable property, the Department of Lands and Surveys in the Republic of Cyprus is the only public department in Cyprus that is involved with the rights related to immovable property and a Title Deed needs to be officially registered with this Department.

A Title Deed becomes relevant in the immovable property buying process (whether this involves a home or land), for the transfer of absolute ownership from the seller to the purchaser.  A lawyer will check the Title Deed to make certain that the seller has the right to sell the property. For example, if a property is owned by a minor (under 18 years of age), a court order has to be obtained to sell the property. The Title Deed also contains important information such as, if any other person has an interest or share in the property, the boundaries of the property, rights of way through the property, including its location, registration number and if there are any restrictions which apply to the Title Deed.

It is important to note that Title Deeds exist for all immovable properties in the Republic of Cyprus. If purchasing an entire property with an existing Title Deed, the title can easily be transferred from the seller into the purchaser’s name, when being represented by a lawyer. The lawyer will be able to assist in making certain that all of the immovable property taxes, municipality taxes and any income or capital gains taxes have been paid and the relevant Tax Clearance Certificates have been issued. The lawyer will also assist in paying and obtaining all receipts of settlement for all electricity and water bills, including local taxes due to the authorities, as well as the payment of any communal fees up to the date of delivery of the property. The contracts will then need to be stamped by the Tax Authorities. In addition, so as to follow the correct process the seller needs to declare that there have not been any additions or alterations to the property which affect the issue of the permit. The transfer of the Title Deeds will be undertaken by the Department of Lands and Surveys either by the seller and purchaser in person or their authorised representative that has been granted a Power of Attorney.  The transfer of ownership will be made to the purchaser following the complete payment of the purchase price of the property, including payment of the transfer fees and stamp duties which are calculated by the Department of Land and Surveys, according to the value of the property on the date of transfer of the property.

The issue procedures become complicated when, for example, there are any legal obligations, mortgages, encumbrances and/or burdens on the property, including in some cases where there are structural contraventions which do not comply with the relevant permits and licences. The Title Deed transfer/issuing process depends on each individual case and whether all of the relevant regulations have been adhered to, the relevant permits and licences have been obtained, as well as all the taxes, encumbrances and charges have been paid, including the property transfer fees and stamp duties to the Department of Lands and Surveys.

With the construction of new building project complexes, whether these are apartments or clusters of homes, the first application required is the permit for the division of the land.  The construction of new projects must then be completed in accordance with the planning and building permits. Building project complexes, however, may also require, for example, inspections on fire safety regulations from the Fire Department as well as the local municipality/authorities for the issue of the relevant licences. If an operational communal pool has been built as part of the complex, a swimming pool licence will be required. If all goes well and all of the inspections have been successfully completed with the necessary licences obtained and fees paid, a certificate of completion is filed with the Department of Urban Planning and Housing. At the same time, a submission is made for the separation of each individual unit. If approved, an application is made with the Department of Lands and Surveys for the separate issue of the Title Deeds. The Department of Lands and Surveys will undertake its own investigations and examinations of the building project and it will begin the process for issuing of the separate Title Deeds for each individual property. On completion of the process, the purchaser will need to pay the transfer fees and stamp duties and within a few months of completion, the Title Deeds will be issued thereby securing the ownership of the property to the purchaser.

The problem of ‘Trapped Property Buyers’ arose from purchasers who had complied with their contractual and financial obligations to the seller and had also deposited their contract with the District Land Office by 31/12/2014. If the contract had not been deposited by this date, a Court application would need to be made to obtain an Order for ‘Specific Performance’, and to deposit the contract. The Trapped Buyers issue is very intricate and complex since it encompasses the involvement of many parties such as the developers, the buyers themselves, the banks, central government and local government departments. Depending on each individual case and the cause of the source of the delay, these cases need to be assessed and examined separately to either mitigate the risk of delay or perhaps find a remedy to the problem and initiate the procedures necessary to receive the Title Deeds.

It is very important that property owners understand the reason that they are not in possession of their Title Deeds and they should undertake appropriate action to protect their property, by addressing the delays or difficulties with an experienced lawyer, so that a course of appropriate action can be undertaken to help resolve the obstacles hindering the issue of their Title Deeds.

The content of this article is valid as at the date of its first publication.  It is intended to provide a general guide to the subject matter and does not constitute legal advice.  We recommend that you seek professional advice on a specific matter before acting on any information provided.  For further information, please contact Elizabeth Michael at Elizabeth.Michael@kyprianou.com

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