“Such a change in the law would represent a far-reaching and constitutionally questionable interference with the private autonomy of borrowers and lenders. The signal for Austria as a location and legal certainty in our country would be fatal. The proposals clearly exceed constitutional limits,” Franz Rudorfer, managing director of the federal banking and insurance division in the WKÖ, criticizes the encroachments on fundamental rights.
Despite the ongoing multi-crisis environment, the rate of defaulted loans for housing financing remains at a historically low level. The voluntary measures taken by Austrian banks, such as the suspension of late payment interest and reminder fees, also contributed to this. “The basic advice to borrowers to contact their bank immediately if problems arise with loan repayment remains, of course,” says Rudorfer. “This ensures that tailor-made solutions are found for customers should there be problems with repayment. We see this very clearly in the numbers: Where borrowers need help, they get it. What’s more, Those borrowers are disadvantaged – and that’s at least 50% – who have chosen a fixed interest rate for their housing financing from the start. We consider this political comprehensive mentality to be the wrong approach,” said the spokesman for the Austrian banks.
The Green Party’s proposal – without any opportunity for assessment or discussion – to retroactively convert variable mortgage loans to fixed-interest loans by law by 2016 is therefore a clear miss in the topic.
The supervisory and legal principles of creditworthiness assessment would be overridden by law and an artificial interest rate that does not come close to market rates would be set by the Financial Market Authority (FMA). By making it difficult or impossible to control the refinancing structure of banks, this planned economy-like approach would lead to significantly higher liquidity costs and thus also result in more expensive loans for consumers. “The Greens’ proposal unnecessarily jeopardizes the realization of the dream of owning a home for many Austrians,” said Rudorfer.
Massive fundamental rights concerns
These mainly affect the following areas:
- There is a massive and disproportionate interference with the banks’ freedom of employment and private autonomy.
- The principle of legality is also questioned. The protection of trust in existing legal regulations also applies to banks.
- The principle of equality is affected.
- In terms of fundamental rights, this would be a serious interference with the property rights and freedom of acquisition of banks – every bank has a medium to long-term refinancing structure behind its financing.
The specific design of the proposal is also extremely dangerous, according to which the switch to fixed conditions should apparently take place by the end of the original term – i.e. up to 30 years. In addition, the right should also be able to be exercised retroactively for loans that were taken out after the Mortgage and Real Estate Loan Act (HIKrG) came into force (i.e. from 2016).
(PWK460)
2023-12-13 16:31:18
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