The Parliament’s Legal Committee has agreed to remove the First House program from the new law on mortgage loans. Bankers and representatives of Romania’s National Bank (BNR) have come up with the amendment.

The new law enforces giving in payment as a way to get rid of mortgage loans.

The MPs in the Legal Committee have also decided that the new mortgage law will apply only for credits below EUR 250,000.

The amendments also need to be approved by the Chamber of Deputies, which has the final say on this.

Almost 160,000 people contracted loans through the First House mortgage lending program, and the non-performing loans ratio reached 0.04% at the end of 2015.

The central bank as well as commercial banks, Government, and business associations have voiced their concerns that the new law on giving in payment would lead to the disappearance of the First House state-backed program, which has been the main driver for mortgage lending and residential sales in the past years.

editor@romania-insider.com