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The cabinet approved a scheme to help borrowers from vulnerable groups facing foreclosures protect their primary residence provided they fulfil certain criteria, press and information office said.

Beneficiaries are private borrowers or owners of small enterprises with an annual turnover up to €250,000 employing less than four workers with the primary home serving as collateral in both cases, the PIO said in an emailed statement today. The net value of the residence has to be less than €250,000 while the outstanding amount has to be less than €300,000.

Under the terms of the scheme, borrowers must have exhausted restructuring and mediation procedures and already have applied to the insolvency agency for loans granted by a financial institution licensed by the Central Bank of Cyprus, the PIO said. Borrowers have to be residing permanently in Cyprus or legally in the previous ten years, and for at least five years in the mortgaged home.

The maximum government interest subsidy rate will not exceed 4 per cent and the new scheme will also take interest subsidies for housing loans under the guaranteed minimum income scheme into account for this purpose, the PIO said.

The state-owned Cyprus Land Development Corporation will be responsible for implementing the scheme, the PIO Said.

By Andria Kades