In two places, work is underway on solutions to lead to a universal housing loan agreement. The main thing is that the provisions of such a contract should be clearer and safer for consumers, and legal risk decreased for banks. Experts at the European Financial Congress are working on the model agreement (the project was presented at the end of July), the version of the uniform model of the contract is developed by the Office of Competition and Consumer Protection.
– We assess both initiatives to develop a model mortgage contract model positively, it is a very good direction, which aims to reduce legal risks regarding these contracts. And this is not because they have sewn in, but because we are dealing with a speeding and massive scale, unheard of in other EU countries, an industry undermining mortgage agreements. A model contract may also limit the unjustified profits of law firms and compensation, which, after all, let's face it: they do not act in the interest of the consumer only to maximize their profit – comments Tadeusz Białek, president of the Polish Bank Association.
Two main demands for the EKF project
ZBP submitted 39 comments to the model draft agreement formed at EKF. – They are not a disavowant or criticizing the whole project. Rather, they result from our banking practical experiences In the scope of the functioning of the product, which is a mortgage – says the head of the ZBP. The consultations of this project conducted by EKF were to last until August 20, and until September 30 the final version of the contract is to be ready.
ZBP submitted two basic comments: regarding the formula calculations of compensation for banks for early repayment of a loan with a period of fixed interest rate and in legal scope of the model contract. This is the first issue is an important problem, because Polish banks, due to uncertainty and legal risk, are afraid to charge fees for early repayment of such loans (although they can do it theoretically). We wrote about this problem, among others Here and here. In turn, the discussion about the legal authorization of the model contract concerns whether it should be introduced by an attachment to the regulation or act or – as expected by the EKF variant – on the basis of good practices. This issue was discussed by prof. Michał Romanowski, who managed a group of experts at EKF.
Other remarks had more clarifying, technical and legal nature, for example, the fact that the contract lacks clauses of the required law in the scope of, among others GDPR clause or other transferred on the basis of banking law.
The EKF project was given a model for calculating compensation: provides 1.5 percent The amounts of interest falling for each year remained until the end of a given permanent interest rate, which the customer would pay if he did not make a prior repayment. – In our opinion, the proposed pattern does not fully compensate for the losses incurred by the bank in connection with early repayment of the loan. Compensation should be calculated so that the economic equivalent is preserved. However, the very fact of the appearance of compensation in the model contract is positively assessed – emphasizes Tadeusz Białek.
A uniform agreement is to be invalid legally. How to do it?
Referring to the legal authorization of the contract, the President of the ZBP estimates that a pattern that would be based only on good practices (even if they were to be adopted by an organization of banks) seems to be insufficient. – I do not diminish in this place, as a rule, good practices or recommendations prepared for banks. However, in a situation where we are dealing with mass undermining contracts and the transfer of the Frankowe Chancellery industry from franc mortgages to PLN, based on good practices is not enough in terms of legal certainty – he assesses.
See also: Loans in Poland may have a lower interest rate. Here are ten ways to do it
– After all, even the recommendations of the Polish Financial Supervision Authority, which I cannot accept legally, because the PFSA clearly defined in the provisions of the banking law competences in this respect were rejected by the courts as non -lawying rights and the relevance of laws that have no significant importance for courts. I am referring to the recommendation S, referring to the implementation of the guidelines of state supervision regarding the additional obligations of banks related to the provision of foreign currency loans, i.e. information obligations or the issue of an additional buffer when assessing the creditworthiness of persons submitting the application for a currency loan – argues Tadeusz Białek.
ZBP requested that the model agreement be introduced as an attachment to the Regulation of the Minister of Finance. UOKiK went even further in his proposal: to introduce his model contract with an attachment to the Act. Would it not be a better solution, a “stronger” legally and more difficult subordinate?
– On the one hand, yes, but there are also disadvantages of such a solution. I would like to remind the words of Jacek Jastrzębski, chairman of the Polish Financial Supervision Authority, who pointed out that in the case of the law there would be a deprivation of flexibility of the pattern. This solution is definitely less flexible, possible changes in its records would require the transition of the entire legislative path – says the president of the ZBP.
He adds that you have to take into account the need to change the pattern records from time to time due to evolving regulations (often resulting from the implementation of EU regulations) or emerging judgments. According to ZBP, the attachment to the regulation gives much greater flexibility and enables changes in a significantly simplified mode. – At the same time, in our opinion, it would give similar legal certainty, because it would benefit from the presumption of compliance with the law and thus would be excluded from the examination of abusiveness. It cannot be ruled out that during further work on the EKF project, the authors would also come to the conclusion that the model contract should become an attachment to the regulation – he argues.
UOKiK proposal under the magnifying glass of banks
– We are glad that the President of UOKiK took into account the postulate of banks and the project provides for a 5-year permanent foot period, not 10 years, as was originally planned. While we appreciate the compensation for banks provided for in the model in the event of early repayment of the loan with a fixed rate, as in the EKF project – we believe that the model of calculating this amount is not optimal for banks – says Tadeusz Białek, commenting on the design of a uniform pattern of a mortgage agreement arising in UOKiK.
However, in this project, the problem is a banned sales ban proposed by the office (now so-called cross-selling is now a common phenomenon, by giving mortgages banks sell e.g. insurance or bills). – This is a very important issue for banks, we are in a dialogue with the President of UOKiK in this respect. We believe that as part of the exemplary agreement, banks should be able to offer a minimum of two products: a loan repayment account and real estate insurance or life insurance – emphasizes the president of the ZBP.
See also: Closer to a uniform housing loan agreement. It will be a breakthrough
The next question is whether there is room for two projects (EKF and UOKiK) and whether they will argue with each other. – We support both projects. As prof. Romanowski: Coffee does not exclude tea. The idea of working on each pattern is correct. As the Chamber of Commerce, we also participate in giving opinions on the project, which is run by the President of UOKiK – indicates Tadeusz Białek.
However, he adds that it is difficult for him to imagine that these projects will ultimately function as two independent. – I think – and I encouraged both designers to do so – to connect forces and sit down to the table together and try to bring both projects close, since we agree that we have a common goal to reduce legal risk. Perhaps an agreement could be obtained to apply the “intermediate variant”, i.e. regulating the pattern in the formula of the attachment to the Regulation – adds the president.
Five years of fixed interest, but without coercion
Both projects predict a five -year permanent foot period. Was it not possible to provide a longer period, for example seven years old or ten years? Consumers would probably be satisfied with contracts for a longer period, originally the UOKiK proposal assumed 10 years of unchanging interest.
– Considering the current conditions, securing such a long position, lasting 10 years, would be more expensive for the bank, which would translate into an increase in the cost of such a loan for the consumer and that is probably why they would not be popular. Of course, we are working to extend the periods of constant foot. It is necessary to develop the security instrument market. As part of the National Working Group, there is a team that operates towards the development of the repo market. And although this process will last summer, we will come to a situation where banks in Poland will grant more loans with a longer permanent rate when they become more available for customers. First, however, we must reduce the cost of security of the interest rate – explains the head of the banking union.
Both models of the contract template, created in EKF and UOKiK, They do not provide for a mandatory fixed foot, and earlier there were postulates to introduce a compulsion to such an interest rate for the first loan for the purchase of an apartment in which the consumer would live (i.e. not for investment purposes).
– ZBP is in favor of the popularization of a fixed foot in mortgages, but I repeated many times: the interest rate environment must be stabilized so that you can talk about a broader promotion of such loans. Currently, when the expectations of a decrease in the feet are common, this is not the best time for the mandatory introduction of a fixed foot into the model mortgage agreement. The time to spread mortgages with a constant foot will come after stabilizing the official and market feet, which according to our analyzes will take place in the second half of 2026. I emphasize, and this is also the expectation of the PFSA and UOKiK that ultimately the model of a mortgage agreement for natural persons should be based on a period of permanent rate. In the perspective of five years, we will probably have only a fixed foot loans on the market – says Tadeusz Białek.
UOKiK is still working on its project
The UOKiK project has not yet appeared in the list of legislative work of the government, despite the fact that at the beginning of June the president of the office announced that it would happen soon. Is there a threat that there may be problems with the procedure and adopting these provisions? “Work on the project is still underway, it will now be consulted with the Ministry of Justice ” – The UOKiK press office answered for Business Insider Polska's questions.
How does UOKiK assess the initiative of EKF experts? Can both solutions coexist? “We do not refer to alternative proposals – our goal is to prepare a uniform, coherent pattern that will have a normative character. According to the President of the Office, such a model, resulting from the law, will ensure real consumer protection and reduce legal risk on the side of banks” – replied UOKiK.
It was added that the existing solutions presented by the sector did not gain the favor of the office, because they were to focus on protecting the interests of only one party to the contract – banks. That is why we decided to work on developing a solution that is favorable to borrowers, respecting the rights of entrepreneurs (lenders) at the same time” – indicated.
UOKiK added in response to our questions that a normative solution, regardless of whether it will be adopted in the form of a law or ultimately in the formula of the regulation, has another, extremely important advantage: allows you to conduct wide and professional, public consultations. “This is an extremely important aspect, often omitted in public discussion, which also allows you to build social trust in the adopted solutions. Time will show whether the government side and the banking sector will be ready to really support this solution, favorable in our opinion for borrowers and economy, including the development of housing” – added in response to UOKiK.
Author: Maciej Rudke, Business Insider Polska journalist
