EMF publishes its strategy in response to the credit crisis

The European Mortgage Federation has set out a series of recommendations, which are designed to contribute proactively to the European Commission’s initiatives to restore long-term sustainable mortgage financing in the EU.

Recommendations to EU institutions and national authorities:

§          Avoid making any parallel between the EU’s and USA’s mortgage markets when considering action as these markets are not comparable, and be mindful in considering action not to jeopardise the competitiveness of EU markets in a global economy;

§          Take account of the diversity of models that exist across the EU’s Member States when considering action and, therefore, give priority to the proposal of precise, targeted measures over wider “one-model-fits-all” schemes;

§          Ensure that all lenders/loan originators, whatever their business model, are subject to adequate supervision and apply sound lending principles throughout the loan granting process;

§          Ensure that candidate borrowers receive adequate information when taking out loans; and

§          Ensure the full transparency of bond issuance and (re)packaging, and the due regulation and adequate supervision of credit rating agencies.

The EMF is currently working on the development of a Framework for Sound Lending Principles, which it will aims to publish by the end of March 2009.

It is also striving to increase the level of uptake of the European Voluntary Code of Conduct on Home Loans in the EU’s 27 Member States. In the event that the uptake of the Code does not reach a satisfactory level in a reasonable period, the EMF will discuss alternative options with the European Commission.