The Commission has published a draft Directive on credit agreements relating to residential property. The proposal:

  • introduces requirements for advertising mortgage credit;
  • requires proper regulation and supervision of originators and distributors of mortgage credit;
  • sets out principles for authorisation and registration of credit intermediaries and for a single passport for authorised intermediaries;
  • sets out conduct of business rules for the provision and presentation of information about products and intermediaries, standards of explanations, and advice and requirements to assess the borrower’s ability to repay;
  • introduces a harmonised annual percentage rate in line with that set out in the Consumer Credit Directive;
  • would allow borrowers to make early repayment; and
  • would allow lenders to access credit database information in a non-discriminatory way.

The Commission has also issued a paper on how Member States avoid foreclosure practices. The Parliament and Council will now begin considering the proposal. (Source: Frequently Asked Questions on mortgage credit proposal)