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Terms of mortgage contracts to be presented in tabular form

21 January 2020

The most important terms of mortgage-backed consumer loans, which must be approved by borrowers before they sign the agreement, will now be presented in tabular form. Corresponding Bank of Russia Ordinance No. 5350-U, dated 10 December 2019, will take effect on 30 January 2020.

These terms specifically include information about the loan amount, its due date and interest rate, methods of repayment (including free-of-charge options), as well as a list of paid services provided by the lender and information on whether the lender is ready to assign claims under the loan agreement to third parties.

Mortgage contract terms not listed in the table may be specified either outside the table or below it.

The tabular form, which is already used in concluding consumer loan agreements, makes it easier for borrowers to understand the main terms of the agreements they sign. This approach provides an efficient way to inform consumers and helps them to assess their risks while making the decision to get a loan. It also promotes a more responsible attitude towards the fulfilment of loan obligations.

This regulatory document will cover all organisations engaged in mortgage consumer lending.

Preview photo: Mariia Boiko / Shutterstock / Fotodom