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10 September 2013

Statement by Commissioner Barnier following the EP vote related to new rules on mortgage credit lending

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The EP confirmed its willingness to make the mortgage credit sector subject to heightened consumer protection measures at Union level by approving in principle the new rules on mortgage credit lending.

"I welcome this important step towards strengthening consumer protection in the financial services area and towards completion of the Single Market. I hope that the European Parliament and the Council will now finalise the text as soon as possible so that the new rules will benefit consumers without delay.

"The aim of the Mortgage Credit Directive (MCD) is to make ‘responsible mortgage lending’ the norm across Europe. It will also grant lenders in the long run new business opportunities through the creation of a Single European Mortgage Market

"The purchase of a property entails substantial costs and is often financed through a mortgage credit. Two-thirds of European households’ entire outstanding debt is constituted by mortgage credits. In the wake of the financial crisis, arrears and default rates have risen with often dramatic consequences for individuals and a negative impact on the economies of Member States as a whole.

"The Directive introduces ‘responsible lending’ practices across the EU with heightened credit worthiness assessment standards.

"Credit intermediaries that comply with the new business conduct rules will gain access to a Single Market of 500,000,000 potential consumers via the pass-porting regime. This will result in more EU-wide competition and is expected to drive down prices in the long run."

Full statement

© European Commission

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