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Romanian Bks To Have New Lending Rules In Less Than A Week – Bks Assoc Head

Romanian banks will have new lending rules in less than a week and will ask for a minimum advance paid of 20%-25% at mortgage lending, the president of the Romanian Banks Association, Radu Ghetea, said Thursday.
Romanian Bks To Have New Lending Rules In Less Than A Week – Bks Assoc Head
15 ian. 2009, 18:16, English

“In a few days, each bank can have its own lending rules. (…) It depends on the bank. As regards the advance, the banks will set a level of 20%-25% of the dwelling’s value,” Ghetea said.
 
As for loans in foreign currency, Ghetea said they will not grow at the same pace as in 2007 because of the current leu exchange rate.
 
The central bank’s Managing Board eliminated the stress tests used for mortgage and real estate applications, but kept the stipulation that the borrower’s revenues should be accepted only in a margin of +/- 20% from its past year’s revenues according to its fiscal draft.
 
The new provisions will enter into force as of their publishing date in the Official Gazette.
 
Romania’s central bank also agreed to increase the indebtedness degree for mortgage-guaranteed loans, as the default rates for this kind of lending is considerably lower than in consumer loans’ case.
 
The new lending rules will be valid only after being approved by the management of each bank. The new norms should afterwards be submitted to the central bank for approval.
 
According to the current regulation, the banks will calculate a debt degree for household lending based on revenues that do not exceed by more than 20% the ones declared to the Fiscal Authority in the previous year.