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Photo: Līga Gredzena/LETA
The state could support those mortgage borrowers whose payments exceed 20% of their income, however, at the same time, such an arrangement would not apply to families with children, to whom support could be provided regardless of the size of the payment in relation to income, it is expected today in the Budget and Finance (Tax) Commission of the Saeima Amendments to the Consumer Rights Protection Law supported in the second reading for consideration.
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After the Saeima also supports them in the second reading, both the commission and the Saeima will still have to work on them in the third, final reading.
The credit institution will have to pay a fee to the mortgage borrower in the amount of 30% of the interest payments calculated for the relevant quarter, but not more than two percentage points from the interest rate determined for the period, taking into account that the reduced interest rate must not be lower than the initial rate.
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The exact wording of the bill for the second reading will be available for the Saeima session, at the same time the current working version provides that support is provided to those consumers for whom the last payment of the mortgage loan agreement calculated during the calendar month will exceed 20% of the total available average of the consumer (borrower together with co-borrower) monthly net income during the last six months.
However, this rule on the 20% limit does not apply to consumers whose families will be waiting for a child at the time of submission of the application or will have a child up to and including 23 years of age.
In order to receive support, the consumer will also have to meet several other criteria. The support will be valid either for the only mortgage loan agreement, or for such real estate, where the consumer or a member of his family has declared.
The mortgage loan agreement must be concluded by October 31, 2023, and the balance of the mortgage loan cannot exceed 250,000 euros. The consumer will also have to submit an application to the toll payer or credit institution for receiving the specified support.
The amendments envisage the introduction of a mortgage borrower protection fee for the provision of support to credit institutions.
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However, the mortgage borrower’s protection fee would not be applied to those mortgage loans issued with a fixed interest rate throughout the loan repayment period. Perhaps this wording will also be clarified in the table of the bill for the Saeima session.
Credit institutions that will be the payers of the fee will be required to provide support to eligible mortgage borrowers by paying the above fee to consumers.
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2023-11-01 11:33:00
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