Property Trusts in North Cyprus - Secure or Not?

walkerscott


Joined: 13/08/2009
Posts: 901

Message Posted:
21/01/2011 18:15

Some Lawyers have advertised PROPERTY TRUSTS as an alternative to hold and "Own" property in North Cyprus. I have corresponded with a few well known Lawyers' Offices and although very helpful initially, ALL failed to fully allay my fears about securing my investment.



Maybe YOU have some experience in this area which you may wish to share through my site below and this forum? If you do, please email me with your comments for the benefit of all to read and understand.



http://www.no-deeds-no-money.moonfruit.com/#/property-trusts/4547650393

my recently produced page above shows some Question & Answers on the subject. I would like to think that with your help it could become a very thorough and informative page to help others.

I actually thought at first that it is the way to go - what do you think?

walkerscott


Joined: 13/08/2009
Posts: 901

Message Posted:
07/02/2011 16:21

--- ditto -----

Hector


Joined: 26/08/2008
Posts: 2352

Message Posted:
07/02/2011 17:50

Good article. The £1000 set up fee plus £100 pa is another example of 'money for old rope' for advocates.

Hector


Joined: 26/08/2008
Posts: 2352

Message Posted:
07/02/2011 19:04

Problem is, is anything secure in the TRNC?

cronos


Joined: 26/10/2008
Posts: 2093

Message Posted:
07/02/2011 21:19

Hector.....jobs for UBP family members are pretty secure !

zookeeper


Joined: 17/03/2010
Posts: 168

Message Posted:
08/02/2011 06:50

I read your posting and your link with great interest as we are considering purchasing a property in TRNC but are very wary of the possible pitfalls concerning deeds/PTP/memoranda/etc.



Trusts such as these could offer a possible solution.



Could an answer to "the worst case scenario" be for the "company" to take out a performance bond (or similar) with a bank to the value of the property (which could be adjusted - up or down - periodically) in favour of the individual property owner? Obviously the annual cost would increase.

Tenakoutou



Joined: 27/07/2009
Posts: 4110

Message Posted:
08/02/2011 09:56

When one fully understands the horrendous cost of tax implications, the answer has to be a resounding 'No!'

cronos


Joined: 26/10/2008
Posts: 2093

Message Posted:
08/02/2011 10:06

Zookeeper.....in a country where supposedly the legal sytem is based on English Law, why should us foreigners have to try and find complex and costly schemes just for the privelege of buying a property?



Why can't we just agree a sale,pay a deposit, sign a contract, and swap money for deeds ?



It seems to work in most of the civilised world !

zookeeper


Joined: 17/03/2010
Posts: 168

Message Posted:
08/02/2011 12:46

My comments were primarily for Walkerscott, who at least appears to be proactively trying to achieve something to overcome the impasse rather than just being negative and/or destructive.



Message 7 Can you expand on this glib generalization?



Message 8 You appear to be rather insular and blinkered if you think that "the rest of the world" has procedures as open, fair and uncomplicated as the UK-believe me it doesn't!



Walkerscott, Could this procedure be used to purchase pre'74 (i.e "safe") property without PTP being required?

elko2



Joined: 24/07/2007
Posts: 4400

Message Posted:
08/02/2011 13:03

Personally I would not touch it.

ismet

zookeeper


Joined: 17/03/2010
Posts: 168

Message Posted:
08/02/2011 13:50

Why not Ismet? What dangers do you foresee if all the safeguards noted above are put in place?

pollymarples


Joined: 08/08/2010
Posts: 1778

Message Posted:
08/02/2011 14:46

If ismet says he wouldn't touch it, that is good enough for me.

cronos


Joined: 26/10/2008
Posts: 2093

Message Posted:
08/02/2011 16:41

Zookeeper....I'm so sorry that you feel that I am insular and blinkered, and that another poster who has also been at the receiving end of the TRNC is "glib".



By all means go ahead, get yourself a property trust, and then report back in a few years time if it has worked out for you.



This is a public forum, if you just want a response from walkerscott then email him direct.....otherwise you'll have to put up with comments from others such as I who know nothing !

elko2



Joined: 24/07/2007
Posts: 4400

Message Posted:
08/02/2011 16:54

1. There is no such thing as an "irrevocable POA". They can all be revoked.

2. You are using the Trust Company to do away with the PTP requirement i.e. you are going round the law and against its spirit. In such situations don't expect the courts to help you out i.e. you have to go to court "with clean hands".

3. What happens if the company goes bust? What is your security?



Sorry, not for me.

ismet

Tenakoutou



Joined: 27/07/2009
Posts: 4110

Message Posted:
08/02/2011 19:44

There you are, 'zookeeper', 'elko2' has 'put it in a nutshell' for you!



Of course, you could buy your property and then 'go the mortgage route' - the old 'false mortgage' trick!



However and whichever, our 'Most Helpful Member's' advice is equally as valid.



Just because a [legal] system, in your book, should be sound and incorruptible - have you not yet been quoted the time worn adage: 'This is Cyprus!' - ???

zookeeper


Joined: 17/03/2010
Posts: 168

Message Posted:
09/02/2011 14:43

Ismet Thank you for your response and valuable points to be taken into consideration.



Pollymarples I too respect Ismet, his views,opinions and experience (particularly with his local aspect and insight).



Cronos and Tenakoutou I have no intention of decrying or in any way belittling the wrongs and hurts you (and innumerable others) have suffered at the hands of the "system" in TRNC, they are truly horrendous. I addressed the issue through this thread as I thought it was a forum for discussion of a serious topic, open to debate and welcoming of contributions from all interested parties. Despite my genuine and deeply felt sympathies for your positions, I have no intention of suffering the same fate (you may respond by saying "in that case stay well clear and do not purchase"). I believe that Walkerscott is investigating a possible different approach to purchasing problems IN A TOTALLY LEGAL WAY which, if successful, could help not only me but countless others in the future.....c

zookeeper


Joined: 17/03/2010
Posts: 168

Message Posted:
09/02/2011 14:54

....cont.

All viewpoints, opinions, discussion and especially legal knowledge and advice on the subject with specific reference to TRNC law as applied which could help to determine if trusts are indeed a solution or not should surely be welcomed.



I have lived for many years in countries where there are many laws but no fairness or justice and the legal system is arbitrary and randomly applied and totally biased towards the indigenous population. Of course a legal system should be sound and incorruptible but I know that it never is, to a greater or lesser degree, whichever country (including UK) you may be.

walkerscott


Joined: 13/08/2009
Posts: 901

Message Posted:
12/02/2011 16:56

Thank You Everyone for taking part in the discussion.



Tenakoutou

- re your comment about Tax Implications and costs: would love to know more and would appreciate further info and / or links in this respect.



Zoo Keeper - I have emailed you privately ...

Has anyone else used Trusts in the TRNC to hold Deeds in? Your experience and comments would be welcome.

Tenakoutou



Joined: 27/07/2009
Posts: 4110

Message Posted:
13/02/2011 11:42

walkerscott/Msg 18:



I looked into the 'Trust' system as soon as we were refused PTP on our pre '74 Turkish Title property.



Where the real costs come in is when transferring one's property into the Trust and, eventually, perhaps back to oneself, and again to the successive buyer. So, this involves three transfer tax costs, KDV, Stamp Duty, valuation, etc.!



Unfortunately, the advocates omit to inform their clients of these, but are very keen for one to place the property in their [the advocate's] Trust company. Does this protect the purchaser of the property? As far as one can deduce, the Trust company can mortgage one's property without reference to the buyer, as it is the 'owner'. The Trust company can also borrow against its asset(s) - i.e. your property; or have a memorandum taken out against it.



For the full ramifications, perhaps Naomi Mehmet would be able to enlighten us all - although I doubt she'd be very popular within her circle of colleagues if she did!

walkerscott


Joined: 13/08/2009
Posts: 901

Message Posted:
13/02/2011 12:27

Tenakoutou - re Msg 19, thank you.

It was explained to me that the purchasing costs for the trust, which the client pays is the same as if the client was to purchase directly and that any sale later by the Trust on the instructions of the client would also be the same as if one was to sell up privately. The third tier of costs would only come into the equation if one did manage to obtain PTP and or Deeds at a later stage.

http://www.no-deeds-no-money.moonfruit.com/#/property-trusts/4547650393 shows the dialogue between me and one Lawyer who along with others failed to allay my fears in respect of security of assets!

If the Trust was set up just for the one client with the Lawyer/Trust Company as the majority shareholder one could write in the Articles all sorts of "protections" + also place the required Memorandum in one's favour against the Company asset. The Company would be a non-trading, holding only Company.

I welcome further discussion on this from anyone and Lawyers too!

walkerscott


Joined: 13/08/2009
Posts: 901

Message Posted:
13/02/2011 12:30

further to Msg 20

I would only consider doing such if "clear unencumbered Deeds were available in the first place and the security of the asset could be established.

So it is still "no deeds no money advice from me ...

Perry


Joined: 27/01/2007
Posts: 413

Message Posted:
13/02/2011 12:40

I guess nobody would opt for a trust unless they are pretty much forced to. Lets face it there are many people who were recommended to buy pre 74 Turkish as the safe option, with PTP as a formality. After parting with the payment for the property they are kept waiting for years for the PTP, only then to be refused.

So - what now is safest - in the bulders name - a trading company who can (and we all know many have) take out loans on their (YOUR) assets, then go bankrupt - your asset is now part of the settlement and you (foreigner are now on a list of creditors.



Or transfer it to a non trading Trust. Surely it is the best route in such a horrendous situation ???

No1Doyen


Joined: 04/07/2008
Posts: 16617

Message Posted:
13/02/2011 20:17

I wouldn't trust it. (no pun intended)

girne 29


Joined: 06/12/2007
Posts: 1488

Message Posted:
13/02/2011 23:35

Lambs to the slaughter,again.



So the legal profession and various other bodies conspire in a system that allows abuse of the buyer with no recourse under the law, and then ask you give them more money to 'protect' you from----.and so the gravy train goes on.



It would be laughable if it wasnt so tragic.



Its easy, dont buy off plan,dont buy without deeds plus hold money in reserve for possible compensation when agreement with ROC is entered into.You cant go wrong

No ,come to think of it forget about compensation ,why worry about what will happen in 2040.

zookeeper


Joined: 17/03/2010
Posts: 168

Message Posted:
15/02/2011 10:10

Does anyone know the legal concept of "usufruct" (usus et fructus) valid in TRNC and if so could this be used as part of a solution?

Linus


Joined: 04/05/2008
Posts: 281

Message Posted:
15/02/2011 22:27

Has anybody in NC experienced a developer going bust where the buyer has had the property in trust and it has been repossessesed or for that matter the holding company ie a solicitor. I would be interested to know

TRNCvictim


Joined: 17/08/2010
Posts: 1417

Message Posted:
15/02/2011 22:52

Linus (mess 26)



The only way forward for anyone is "NO KOCAN NO MONEY" anywhere in the world you would not give your money without the DEEDS?



Or maybe you like living life on the edge?

Perry


Joined: 27/01/2007
Posts: 413

Message Posted:
16/02/2011 14:38

Linus - the whole point of moving the property into Trust is that you have completed the transaction and the deeds have been transferred from the builder. So if the builder now goes bust, your property is not their asset - it belongs to the Trust with you as the beneficiary. The builder's creditors have no claim.

Of course it is better to have the deeds in your name - but the situation is where peole have acquired pre 74 property - thinking it was the right thing to do, only to be refused PTP. Your property would surely be safer in a legal non-trading company than in the name of a builder - who in these harder times could go belly up with your property as a listed asset......

Linus


Joined: 04/05/2008
Posts: 281

Message Posted:
16/02/2011 21:10

Perry



I agree wholeheartedly and this was my thought process. But doubts are now being aired as to whether the deeds in Trust are still not safe. What happens if the solicitors goes out of business . I assume the deeds would be transferred to another lawyer with my consent. I have pre 74 property with no response on PTP yet still pending an outcome. So I guess I am still at risk now!!!

cronos


Joined: 26/10/2008
Posts: 2093

Message Posted:
16/02/2011 22:24

"Trust" is the operative word here.



This is a "legal" device that has be dreamt up to try and circumvent the tortuous and discriminatory property buying process in the TRNC.



It is not a 100% safeguard....it never will be...and it is expensive and carries tax implications.



Do you trust anyone at all in the TRNC to safely hold the deeds of "your" property on your behalf?......I know that I don't !



You may think that I am bitter and have an axe to grind here, but please listen to Elko2 ( Ismet) on here....a TC, our most helpful member, a mine of information, no stranger to the legal process in the TRNC, and who is married to a respected and knowledgeable advocate....his opinion...



"Personally I would not touch it. "



Ignore it at your peril !

Linus


Joined: 04/05/2008
Posts: 281

Message Posted:
16/02/2011 22:35

Cronos



So your advice is to do nothing there is a bigger risk in doing nothing surely!!!!

cronos


Joined: 26/10/2008
Posts: 2093

Message Posted:
16/02/2011 22:44

Linus



Only you can assess the risk for your particular situation.



We looked into it when we were refused PTP on our Pre 74 apartment and decided that it was expensive and didn't offer sufficient guarantees to make it feasible.



Even our advocate wasn't convinced !



"Throwing good money after bad " springs to mind but everyone has to make their own choice after listening to various opinions.

Linus


Joined: 04/05/2008
Posts: 281

Message Posted:
16/02/2011 23:06

Cronos



I agree everybody has to make a judgement. My advocate recommends it strongly to offer protection and they are one of the most prominent lawyers in NC. So there are conflicting views from different lawyers

TRNCvictim


Joined: 17/08/2010
Posts: 1417

Message Posted:
16/02/2011 23:09

My only advice to anyone is, don't TRUST anything or anyone in the TRNC!!! sorry for being so sceptical :-( it comes from the heart!

walkerscott


Joined: 13/08/2009
Posts: 901

Message Posted:
16/02/2011 23:51

Certainly, sound protection of the interest of the minority property owner / non-owning Trust party is essential. For example, whatever the trust deed may say, what is to stop the legal majority owner of the property / Trust from selling or mortgaging the property without telling the other party? The answer to this is that in some way the minority property owner / non owning Trust party should register an entry at the Land Registry against the title, like in the UK, but I suspect this would have to be a Memorandum of sorts in the TRNC.



If this entry could be registered it would usually be a restriction which would say that there should be no dealing with the property without the consent of the minority property owner / non owning Trust party. This should not be beyond possibility but then again it is the TRNC :-( Maybe it would work once the Government realise that it could actually help pay the wages of the Land Registry employees at £50 a pop!?

Keep debating - it is good to talk

Perry


Joined: 27/01/2007
Posts: 413

Message Posted:
17/02/2011 07:48

Walkerscott - Your point is exactly right - and that is what you should do. By the trust notionally 'selling; the property back to you (pending completion) your property is then re-registered at the land registry back into your name. This will prevent malicious activity such as sale without consent, mortgage etc. The remaining risk is if the trust itself goes bankrupt. So it is at this point you have to be sure that the company created by the advocate is simply a non trading trust....... Of course it is not perfect, but I would say again, if you are in a situation where you have already paid for property and then get caught in the pre-74 PTP fiasco, this has to be safer than leaving it in the builders name - a trading company which is absolutely vunerable to insolvency.

walkerscott


Joined: 13/08/2009
Posts: 901

Message Posted:
17/02/2011 07:54

Hmm, sometimes I wish I was a Lawyer just dealing with Non Trading Property Trusts. What an income earner it could be, much better than a pension fund!

Just take a small number of say 100 Ex-Pats placing "their Deeded Property" into a Trust at £1000- a time - that would easily earn the Lawyer £100,000- for not a lot of effort. Add to this the annual recurring Admin fee of £100- (which is very reasonable) which also provides the Lawyer's business with an easy £10,000-!!!

Times this by 10 to represent just 1000 Ex-Pats and you can understand why I wish I was doing this business myself. I wonder, do you really have to be a Lawyer to get started down this avenue? ))

Perry


Joined: 27/01/2007
Posts: 413

Message Posted:
17/02/2011 08:45

Linus - I have some more documents on this. sms text me your email address and I will send to you. 07710 677480 (UK).

Hoylemiller



Joined: 03/09/2010
Posts: 240

Message Posted:
17/02/2011 08:53

Looks like a scam?

Perry


Joined: 27/01/2007
Posts: 413

Message Posted:
17/02/2011 09:10

Hey Msg 39 - I hope your comment was not directed at me ! The purpose of this board should be to share info and help people. I have simply been also caught up in this situation and am happy to share the details of what we had to do with a member who has the same dilema. I do not want to put those details on a public forum.

Linus


Joined: 04/05/2008
Posts: 281

Message Posted:
17/02/2011 23:27

Perry

I have sent you my details. Thanks

saucyboy69


Joined: 09/02/2008
Posts: 111

Message Posted:
17/02/2011 23:48

Perry,



Will sms you my email as i am also in the same situation and would like any info you have gained.



Pete,

Perry


Joined: 27/01/2007
Posts: 413

Message Posted:
18/02/2011 10:51

Pete - I have received yours and are sending you a response. Paul, did not get yours - please re-send.

zookeeper


Joined: 17/03/2010
Posts: 168

Message Posted:
19/02/2011 14:51

Hi Perry, Have just sent sms to you & would be grateful for your response to our e-mail address. Thanks