Legal Check (Due Diligence)
⚖️ Basic information
Due Diligence means legal and technical checking of the property before signing the Sales & Purchase Agreement (SPA).
The goal is to verify that the property has no legal issues, liens, disputes, or risks, and that the developer is authorized to sell it.
In Cyprus, this check is done by an independent lawyer (not the developer’s lawyer), and the results decide if the purchase can safely proceed.
1️⃣ Why Due Diligence is necessary
- Protects the buyer from legal errors (e.g., missing title, encumbrances, disputes, developer debts)
- Ensures the buyer receives valid ownership rights after transfer
- Confirms the project has building and planning permits
- Checks that the developer/seller obtained all required state approvals
- Needed for Land Registry and bank (mortgage)
2️⃣ What the lawyer checks (full scope)
| Area | What is Checked | Importance |
|---|---|---|
| Title Deed | Ownership of seller, liens, mortgages, court cases | Key for ownership transfer |
| Project registration | Whether developer has town planning and building permits | Without it, construction could be illegal |
| Land Registry record | Plot number, size, boundaries | Confirms exact location |
| Separate Title Deeds | Whether individual titles are issued for units | If not, lawyer checks current stage |
| Tax status | No unpaid taxes on property | Otherwise transfer may be blocked |
| Developer loan agreements | Project not mortgaged to a bank | Prevents double lien risk |
| VAT regime | 19 % or 5 %, resale without VAT | Affects buyer’s cost and obligations |
| Town Planning Zone | Compliance with project purpose | Important for investment projects |
| EIA – Environmental approvals | Environmental permits for large projects | Required for hotels, villas, resorts |
| Developer’s obligations | Developer’s responsibilities to municipality/state | E.g., infrastructure, access roads |
3️⃣ Documents the lawyer requests
- Copy of Title Deed (if it exists)
- Copy of planning and building permits
- Land Registry Plan
- Draft SPA and payment plan
- Tax Clearance for developer
- Project documents (floor plans, site plan)
If something is missing, the lawyer requests it directly from the developer or Land Registry.
4️⃣ Due Diligence output
After completion, the lawyer prepares a written Legal Due Diligence Report, which includes:
- Brief summary of project and ownership
- Identified risks (e.g., unsettled land, developer loans)
- Recommendations for the client (proceed / pause / request contract changes)
The report becomes part of the contract documentation and is often required by banks for mortgages.
5️⃣ Timeframe
- Resale (existing property): 5–10 working days
- New build (off-plan): 10–20 working days (depends on developer documents)
6️⃣ Due Diligence fees
Depends on project type and lawyer:
| Project type | Service Fee |
|---|---|
| Apartment or house (resale) | €1,000–1,500 |
| New build / investment project | €1,500–2,500 |
| Company purchase (LTD, multiple units) | by agreement |
💡 Most lawyers offer a full package, including:
- Preparation / registration of SPA at Land Registry
- Representation during title transfer
- Communication with developer and tax office
7️⃣ Importance of contract registration
After successful due diligence, the lawyer ensures:
- Signing and registration of the SPA at the District Land Office within 60 days
- This creates a Specific Performance Right – the buyer’s right to register the property even if the developer later has problems
Without registration, the buyer loses legal protection.
