Home loan (amendment) regulations : the level of protection to consumers and the role of the creditors

Abstract

This term paper analyses the amendments carried out in the Home Loan Regulations by determining whether the aim of protecting the consumers has been achieved and whether the directive has been properly transposed. The main purpose of these Regulations is to seek to provide a common framework for certain aspects of the laws, regulations and administrative provisions of the Member States concerning agreements covering credit for consumers secured by a mortgage or otherwise relating to residential immovable property, including an obligation to carry out a creditworthiness assessment before granting a credit.

This term paper also focuses on the role of the creditors and credit intermediaries to identify whether their processes and documentation is in line with the Regulations. In addition, this will include an analysis of the creditor’s creditworthiness assessment will be tackled in order to identify how this process is presently being carried. Details on the creditworthiness assessment will be included with particular comparison between this process carried out by each creditor, thus providing a conclusion on whether such process is carried out in a way to protect the end consumer or whether it creates further risks on the consumer.

The scope of this term paper is also to analyse whether the pre-contractual information, the credit agreement and the deed of loan are clearly explained to the consumer and whether the consumer is given a copy of the deed of loan by the notary as required in these Regulations.