European Commission: Commission adoption of a proposal for a Directive on credit agreements relating to residential property

March 2011

The European Commission has published an explanatory memorandum to the proposal for a Directive on credit agreements relating to residential property.

According to the memorandum, the proposal has to be seen in the context of efforts to create an internal market for mortgage credit and against the background of the financial crisis. The financial crisis has had a substantial impact on EU citizens. Although an important contributing factor was the growth in securitisation, which allowed creditors to pass the risk of their lending portfolios to investors, consumers have faced the consequences first hand.

The memorandum includes sections on the legal elements of the proposal, an impact assessment, and a review of the public consultation process.