EU lawmakers have adopted the EU Mortgage Credit Directive after years of negotiations.
The European Parliament held a final vote on 10 December 2013 on the regulations, which will result in a European-wide set of standards for the mortgage market.
In today’s Marketwatch, Building Societies Association policy adviser Sharon Chapman said: “The UK did achieve some good ‘wins’ on this directive in Europe, but we are still left with unwanted provisions.
“Questions remain around how, and when, we will move from the Key Facts Illustration to the European Standardised Information Sheet, and what, if any, consumer benefit the new disclosure document will provide.”
The EU Mortgage Directive is the result of years of negotiation, with UK representatives fighting to protect the buy-to-let market and linked products such as guarantor mortgages. In November, a stand-off over how directives are implemented raised fears a vote on the directive could take place as late as 2014.
EU internal market and services commissioner Michel Barnier said the directive will make responsible mortgage lending the norm across Europe: “Consumers will be better informed as lenders will have to provide them with a standardised information sheet so they know the risks but can also shop around for the best product at the best price to suit their needs.
“It ensures that vulnerable consumers are protected by reducing the risk of over-indebtedness and default. Creditors will be encouraged to apply reasonable forbearance when confronted with consumers in serious payment difficulties.”
In the longer-term, the directive will provide lenders and intermediaries with more business opportunities thanks to the access to a wider market, he added.
In the UK, the Financial Conduct Authority will now provide an interpretation of the rules for firms to follow.
