Centre for European Policy Studies/European Credit Research Institute, setting the right priorities for a new mortgage credit regime for Europe. The financial crisis starting in 2008, and the important role of mortgage loans not only in the subprime crisis in the United States, but also in some EU markets, have acted recently as a catalyzing factor to change the traditional perspective. Mortgages and related asset classes, such as developer loans, are so large in proportion to bank assets that, as the crisis developed, the problems in some EU mortgage markets no longer remained confined to national boundaries. Rather they had EU-wide ramifications, e.g. by affecting investors in other jurisdictions funding banks, or by deteriorating the country’s fiscal position as a result of massive support for failing banks.

The effort to harmonies consumer protection thus must be seen as an element of a whole set of financial reform measures to improve and further align banking supervision in the EU, one that tries to address stability problems at their root – the lender-consumer relationship. Commission Green Paper on mortgage credit in the EU, a related public hearing, the creation of the Government Expert Group on Mortgage Credit (GECMC), the Mortgage Industry and Consumer Dialogue Expert Group (MICEG), the Mortgage Funding Expert Group (MFEG) and the Expert Group on Credit Histories (EGCH), the publication of the respective reports, a White Paper on the integration of mortgage markets and a public hearing on responsible lending and borrowing. Several studies – on costs and benefits of integration of EU mortgage markets; the role and regulation of non-credit institutions in EU mortgage markets; credit intermediaries in the internal market; equity release schemes; consumer testing of possible new format and content for the European Standardized Information Sheet on home loans; and the costs and benefits of different policy options for mortgage credit (undisclosed) – complemented the Commission’s initiatives.