Lenders welcome outcome on European directive
Published: 24 April 2013 | Author: Bernard Clarke
We welcomed this week's announcement by the Irish Presidency that agreement on the European mortgage credit directive has been reached. The proposed directive will sit alongside consumer measures due to be introduced in the UK next April – overseen by the Financial Conduct Authority (FCA) – as a result of the mortgage market review. We anticipate that European requirements will dovetail with UK rules and are not likely to cause problems for domestic lenders.
The outcome in Europe is a testament to the way in which lenders, the FCA and the government have worked positively together for rules aligned to UK requirements. Inevitably, there will be additional work for both lenders and regulators in ensuring the European requirements are properly reflected in UK rules, especially as they will come hot on the heels of implementation of the FCA’s new domestic requirements for mortgages.
Borrowers in the UK already receive a lot of information about mortgages and a considerable degree of protection because the UK’s regulatory regime is the most advanced in Europe. But for consumers in other European countries, the changes will result in increased protection and greater consistency.
To take effect, the new rules must be approved by the European Parliament as a whole and endorsed by member states. A plenary vote is due to be held in the European Parliament on 11 June.