The key to the new mortgage law: the early expiration date
Beyond its claim to provide transparency to mortgage regulation, the new draft law on real estate credit agreements brings a new imperative rule in favor of the consumer: the so-called early maturity
This new instrument - new because, as such imperative rule, does not exist today in the Spanish legal system - it is regulated in the second chapter of the preliminary draft, which aims to establish the guides of conduct for the concession responsible for financing in the acquisition of real estate of use residential It is, therefore, an instrument with which to certainly serve the principle of transparency, but also - and perhaps above all - that of responsibility in this type of recruitment.
In general terms, the preliminary draft always refers to the concept of residential use - and not habitual use - of the borrowing acquirer, which, in our opinion, assumes that the law exceeds the scope of consumer protection to be more widely placed in the one of the protection to all the physical persons with mortgages.
It is important to note that, in general terms, the new law will not apply to loans and credits subscribed prior to its entry into force. And, nevertheless, it regulates the mandatory expiration imperatively even for contracts signed before its approval.
We applaud this imperative regulation, and also that the resolution for breach of the contract - the anticipated maturity is not another thing -, it is made depend on the breach of the debtor to be sufficiently significant in relation to the obligation pending compliance. That is, it is a serious breach, since it could not be otherwise given the gravity of its consequence.
However, as a critic, we believe that it would have been desirable to clarify the true scope of non-compliance. Especially if you want to comply with the maximum transparency that the Reason shows teaches us. If we consider the difficulty that sometimes involves determining the seriousness of the breach with only the knowledge of the debtor balance, it would be desirable to establish with greater clarity the weight of non-compliance for the purposes of monetary execution.
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