He Central Bank (BCRA) seeks to promote UVA mortgage loans and advance the deregulation of this product so that banks have greater capacity for action when agreeing on the conditions with their clients.
Through the Communication “A” 8024, The Central updated the regulations on “Credit Policy” in order to standardize the UVA loan systems and established that the rate can be freely agreed upon between the parties.
On the other hand, “the obligation for banks to offer insurance to cover mismatches between Reference Stabilization coefficients (CER) and Casa Proipa (CVS)which made them maintain the quota-income relationship, adding more quotas at the end,” explains a market source.
Changes in inflation insurance: how it affects beneficiaries and banks
This implies that, from now on, “It becomes voluntary for banks to offer this or another type of insurance“and sources close to the BCRA anticipate that “What is expected is that this measure will reduce the costs of mortgage loans as well as facilitate its securitization (sale of credit packages in the capital market)”, which they hope will allow greater development of this type of financing.
Federico González Rouco, expert housing economist, evaluates that “it is a good measure because extending the term in the event of a 10% increase between UVA vs. CVS (as the regulations established until now) is something that is of no use to anyone, neither debtors nor creditors.” He explains that the main problem that it generated is that the banks did not have a certain duration of the loans, and that makes securitization more complicated and therefore the entire funding process is more expensive.
However, he does not consider it positive to leave this vertex open so as not to unprotect either party and points out that “it is better to go towards another coverage scheme.”
Mortgage loans: changes in installments and payment/income control requirements
The mandatory condition that payments must be monthly is also made more flexible.
The fact that the installments are monthly is something strange, I can’t imagine banks giving bimonthly installments or more than that.
Likewise, as a counterpart to this, it resolved that They must pay special attention to the income/credit relationship since it established that, “when granting financing to individuals, special attention must be paid to the installment/income relationship so that the debtor can face possible increases in the amount of the installments without affecting their ability to pay, taking into account that your income may not follow the evolution of the Purchasing Value Unit updateable by “CER” (“UVA”).”
The conditions for consumer or housing portfolio loans and commercial loans comparable to consumer or housing portfolio, as established by the new standard, establish that The minimum term of the credits will be one yearthat The rate will be freely agreed between the partiesalthough it will be calculated based on the value of the application of the CER index and will be expressed in Purchasing Value Units “UVA”.
Source: Ambito
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