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“A Step Forward or a Step Too Far?”


31 Mar 2011

Brussels, 31 March 2011 – For immediate release


The European Commission has today published its ‘Proposal for a Directive on Credit Agreements Relating to Residential Property’. This follows 8 years of investigation by DG Internal Market & Services into EU mortgage markets and the mortgage lending business.


However, according to Mrs Annik Lambert, Secretary General of the European Mortgage Federation, the Industry still remains to be convinced that there is a business case for such an initiative.


“In the current environment of flat economic growth, we have reservations about whether the regulation of consumer protection in the field of mortgage credit will ensure a more efficient functioning of the Single Market, as appears to be the Commission’s intention. For consumers, mortgage markets are purely domestic – they do not shop around on a cross-border basis. Therefore, any cross-border mortgage lending is supply-driven, i.e. it is lenders who cross borders to offer their products. The reason for this is the intrinsic link between immovable property and national territory and legislation.”


“The Commission’s Impact Assessment does not make a convincing case that regulation will bring about any change to this. If the Commission’s aim is a more integrated mortgage market, then its focus should be on removing obstacles to lenders lending across borders, obstacles which have been clearly identified in the course of this reflection process.”


Furthermore, the Industry has serious concerns about a number of the provisions proposed, such as the legal obligation to deny credit in the event of a negative creditworthiness assessment and to justify this decision to the consumer: “We strongly believe that such provisions will lead to an unbalanced shift of liability to the lender and to even more legal uncertainty and litigation, which in turn will result in a restriction of access to credit for an increased range of prospective borrowers, notably first-time buyers, the self-employed, those with a lower income etc.”


“The prospect we are facing therefore is less credit to fewer borrowers.”



Contact Persons:


Annik Lambert                       Tel: +32 2 285 40 30

Secretary General          


Sarah Kieran                          Tel: +32 2 285 40 40

Head of Legal Affairs       



For further information on the activities of the European Mortgage Federation please contact:


Avenue de Cortenbergh 71, B-1000 Brussels, Belgium

Tel. +32 2 285 40 30 - Fax +32 2 285 40 31

E-Mail: - Website:



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