EU-wide mortgage protection deal on the way

EU-wide mortgage protection deal on the way

New rules on strengthening the rights of mortgage holders are expected to be agreed in Brussels later today as negotiations under the Irish presidency of the European Union reach their conclusion.

Under the new mortgage credit directive consumers would be afforded more transparency when seeking a mortgage.

However, there would also be tougher credit assessment rules for applicants.

The financial crisis has meant banks and credit institutions have become much stricter in approving mortgages.

However the new directive, which has been pushed under the Irish EU presidency, would see consumers enjoying more transparency, as well as greater harmonisation across the EU in ensuring that the principles underpinning the question of credit-worthiness are toughened.

The directive, which would see a new standardised EU-wide mortgage application, would deal with things like how a reflection period would work, the right for someone to withdraw from a mortgage offer, and what happens if a mortgage holder wants to pay off their debt early.

The new directive wouldn’t, however, be prescriptive in setting out how much a applicant would have to earn before a mortgage is approved.

Negotiations between the European Parliament, the Irish presidency and the European Commission on the directive are expected to be concluded later today

If member states approved the directive it will come into force in two years time.

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