The European Mortgage Federation (EMF) has today responded to the European Banking Authority’s (EBA) Opinions on Good Practices for Responsible Mortgage Lending and for the treatment of borrowers in mortgage payment difficulties (“arrears handling”). These Opinions are addressed to competent authorities and aim at promoting common practices, with the ultimate goal of enhancing consumer protection and contributing to the stability, integrity and effectiveness of the financial system.
In the first instance, the EMF raisesa general concern about possible overlap between the two Opinions and the soon-to-be-adopted Commission Proposal for a Directive on Credit Agreements relating to Residential Property (CARRP) one the one hand, and the recently adopted Capital Requirements Package (CRD IV/CRR) on the other, and the subsequent need for careful monitoring to ensure consistency.
The EMF then goes on to comment extensively on the EBA’s statements regarding the causes of the crisis in Europe and creditors’ prudential conduct in the EU, e.g. how they fund their lending activities. In relation to the proposed Good Practices on Responsible Lending, the EMF provides its views on income verification, reasonable debt service coverage, in particular lending thresholds, and lending & supervisory processes. Regarding the Opinion on Good Practices for “arrears handling”, the EMF reiterates the importance the Industry places on providing sustainable long-term access to home ownership and details the extensive measures that lenders are already taking to support those in financial difficulty.
The full EMF response is available now via the EMF website [1] and the EBA Opinions are available here. [2]
Contacts:
Annik Lambert
Secretary General
Tel: : +32 2 285 40 44
alambert@hypo.org [3]
Jennifer Johnson
Head of Legal Affairs
Tel: : +32 2 285 40 45
jjohnson@hypo.org [4]
Notes to the Editor:
As of August2013, the EMF has 26 members across 16 EU Member States as well as a number of observer members in the EU and the Russian Federation.
Links:
[1] http://www.hypo.org/Content/Default.asp?PageID=427
[2] http://www.eba.europa.eu/-/eba-publishes-good-practices-for-responsible-mortgage-lending-and-treatment-of-borrowers-in-payment-difficulties
[3] mailto:alambert@hypo.org
[4] mailto:jjohnson@hypo.org
[5] http://pr.euractiv.com/sites/default/files/pr/EMF%20Press%20Release%20-%20EBA%20Response%20RL%20%26%20Arrears%2030.08.13.pdf