Everything you need to know about the new mortgage law

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If you are thinking of buying an apartment , and you need financing, you have most likely heard something about a new mortgage law . Despite what many think, the client must still incur some expenses to formalize a mortgage. However, it is also true that the new mortgage law has reduced them to a minimum.


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Entry into force of the Mortgage Law
For months now, many banks have been applying many of the measures specified in the new mortgage law, although it came into force on June 16, 2019 . From this date all banks are obliged to comply with what the mortgage law specifies. This change Romania Mobile Number List in legislation was made to protect the consumer. But what measures have been adopted exactly and how do they affect us? Today we tell you.

Mortgage expenses
One of the main measures that have been adopted and the one that has been most echoed everywhere is the one that affects mortgage expenses. Thanks to the reform of the mortgage law, it will now be the banks who will have to face the costs of formalizing a mortgage loan.

And how does this affect our pocket?
From now on we will no longer pay for notary and agency fees , nor for registration . In addition, the Tax on Documentary Legal Acts (AJD) will also be paid by the bank. We will only have to worry about the appraisal expenses and the Property Transfer Tax (ITP) in second-hand properties, or the VAT , in case the property is new.

The ITP is a tax that varies according to each community. Normally it usually represents between 8% and 10% of the value of the property, although in certain communities you can pay only 4% or 6% . Appraisal fees will vary depending on the appraiser, but they are not a large outlay. Some banks even take charge of this cost to make the process even easier for the client.

Mortgage law



Linkages and the new mortgage law
As those of you who are looking for a mortgage will well know, many banks offered, until recently, linked products as a sine qua non condition for acquiring the mortgage. With the entry into force of the new mortgage law, this practice has ended forever.

The bank may continue to offer you products such as payroll linking , home insurance , life insurance or pension plans so that you end up paying a lower mortgage interest rate . This is what is known as bonuses . However, what it cannot do is force you to contract these products to grant you the mortgage. In this way, the mortgage law leaves the decision of joining or not in the hands of the client , depending on whether it is more or less profitable.


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Amortization expenses
Amortization expenses are nothing more than a penalty that the bank imposes for cases in which the mortgage amount is settled or reduced prematurely. A kind of punishment, for having saved you from paying the outstanding interest.