EBA欧洲银行-EBA-Opinion-on-Good-Practices-for-Borrowers-in-Payment-Difficulties_13页_266kb

Summary of the EBA Opinion on Good Practices for the Treatment of Borrowers in Mortgage Payment Difficulties

Core Content

The European Banking Authority (EBA) has issued an Opinion outlining good practices for the treatment of borrowers facing mortgage payment difficulties. The document aims to support competent authorities in promoting consistent and responsible approaches across the European Union (EU) to mitigate risks and enhance consumer protection.

Main Objectives

• To ensure that credit institutions manage mortgage payment difficulties in a responsible and fair manner.
• To support the development of consistent practices in line with the pending Mortgage Credit Directive.
• To encourage early engagement with borrowers to find sustainable solutions and avoid forced sales or foreclosures.
• To provide guidance for competent authorities in supervising both credit institutions and non-credit institutions involved in mortgage lending.

Key Information

• Payment difficulties are defined broadly and may include situations where a borrower is unable to meet mortgage repayments, possibly referred to as "arrears" in some countries.
• The EBA's Opinion is non-binding and addresses competent authorities, who are responsible for supervising credit institutions and, in some cases, non-credit institutions.
• The document outlines 18 good practices, grouped into four main categories: General Principles, Policies and Procedures, Provision of Information and Assistance to the Borrower, and Resolution Process.

Main Sections and Good Practices

General Principles

The interaction between the creditor and borrower should be guided by honesty, fairness, information, and privacy.

• Good Practice 1: Creditors should act honestly, fairly, and professionally; encourage the borrower to engage; provide adequate information and assistance; communicate clearly; ensure private meetings; and only impose necessary charges.

Policies and Procedures

Creditors should establish and maintain effective policies and procedures for managing mortgage payment difficulties.

• Good Practice 2: Creditors should establish policies for handling borrowers in payment difficulties.
• Good Practice 3: Creditors should have procedures to detect early signs of payment difficulties.
• Good Practice 4: Staff dealing with such borrowers should receive appropriate training.
• Good Practice 5: Creditors should monitor indicators to identify potential borrowers in payment difficulties.
• Good Practice 6: Immediate action should be taken when a borrower enters payment difficulties.
• Good Practice 7: Dedicated information resources (e.g., websites, booklets) should be made available to borrowers.
• Good Practice 8: Contact with the borrower should be proportionate and not excessive.
• Good Practice 9: Creditors should avoid excessive pressure and contact the borrower only at reasonable times.
• Good Practice 10: Borrowers should be informed if a third party is involved in debt collection.
• Good Practice 11: Adequate records of all dealings with the borrower should be kept.
• Good Practice 12: Policies and procedures should be reviewed periodically.

Provision of Information and Assistance to the Borrower

Transparency and support are essential for resolving payment difficulties effectively.

• Good Practice 13: Creditors should promptly communicate with the borrower to understand the cause of the difficulties.
• Good Practice 14: Creditors should provide timely information including:
  • Number of missed or partially paid instalments
  • Total payment shortfall
  • Charges incurred
  • Importance of cooperation
  • Consequences of missing payments
  • Expected timelines
  • Available government support
• Good Practice 15: If difficulties persist, creditors should provide updated information every quarter.
• Good Practice 16: Creditors should consider offering information or advice to borrowers who are in or recovering from payment difficulties.

Resolution Process

The resolution process should aim to restore the borrower's financial situation and avoid further indebtedness.

• Good Practice 17: Creditors should consider options such as:
  • Extending the mortgage term
  • Changing the mortgage type
  • Deferring payments
  • Consolidating credits
  • Changing the interest rate
  • Capitalising the shortfall
  • Offering a payment holiday
  • Assisting with a voluntary property sale
• Good Practice 18: The reasons for offering specific solutions should be documented and retained for a reasonable period.

Conclusion

This Opinion emphasizes the importance of early intervention, flexible solutions, and clear communication in addressing mortgage payment difficulties. It is intended to complement existing regulations and promote common supervisory practices across the EU, ultimately contributing to the stability of the financial system and protection of consumers.