Recently the FSMA has taken position in relation to the regulatory treatment of this type of sale/purchase. If the loans are delinquent or defaulted, but the mortgage has not yet been enforced prior to the sale, the FSMA takes the view that the repayment deferral by the purchaser is an offer of a residential mortgage credit and thus requires the purchaser to be authorised as a mortgage lender by the FSMA under the ML Regulation.ĥ. Since this “exemption” is not included expressly in the ML Regulation, its exact requirements are not clear, let alone set in stone.Ħ. When a mortgage loan has definitively defaulted and accelerated, should the purchaser of the unpaid loan receivable be subject to any licence, other than a registration as a recognised consumer debt collector under the debt collection legislation (the “DC Regulation”)? In practice until recently at least the working assumption was that the debt collection licence should in principle suffice provided the purchaser was not planning to pro-actively offer new credit to the debtor (refinancing, consolidation, …) or to other consumers. This situation is not as such addressed in the ML Regulation. How does this fit within the ML Regulation and, more broadly, within the Belgian regulatory framework? Entities that only purchase and manage delinquent or defaulted mortgage loansĤ. But what about sales of delinquent or defaulted residential mortgage loans. These derogations were introduced in the ML Regulation in 2017, when existing mortgage credit lenders and existing mobilisation institutions were required to seek an updated licence (the “2017 Update”).ģ. However, certain derogations from the normal authorisation conditions are available for two special categories of entities:Ī) entities that only manage and recover mortgage loans andī) certain special types of purchasers of mortgage credit receivables, in particular securitisation vehicles and mobilisation institutions more generally. This authorisation shall be requested to, and granted by, the Belgian Financial Services and Markets Authority (the “FSMA”).Ģ. Under the Belgian regulation on residential mortgage credit (the “ML Regulation”), any individual or legal entity willing to own and hold receivables arising from residential mortgage loans, either by originating such loans or by purchasing mortgage loan receivables, must be authorised as a mortgage lender (“ kredietgever inzake hypothecair krediet” / “prêteurs en crédit hypothécaire”). Authors: Ivan Peeters and Charles-Henri Bernard (PwC Legal / guest bloggers Corporate Finance Lab)ġ.
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