Senator Daniel Zamfir proposed a draft law through which the Prima Casă program can be included in the Payment Law. Currently, Article 1 (paragraph 4) excludes the state program from the law. Another 16 SDP parliamentarians signed Zamfir’s project.

“The current proposal aims to eliminate the exception that excludes the Prima Casa program from the scope of Law no. 77/2016, so that any debtor who is in financial difficulties can benefit from its provisions and avoid bankruptcy, regardless of the type of loan he received,” the initiator’s motivational statement reads.

In recent months, the upward evolution of interest rates has determined a sharp increase in rates for all categories of loans, implicitly for real estate loans, their share of income is becoming larger and more difficult for debtors to sustain, says Daniel Zamfir.

By the way, in its first form, the Payment Act was passed by the Senate together with the first chamber.

BNR: First Home beneficiaries pay just 5% down payment, compared to the minimum 15% down payment required for common law loans

Then, after the public intervention of Cabinet No. 2 of the BNR (Florin Georgescu, also a social democrat in ideology), the First Chamber was removed from the law.

He explains that the principle underlying GEO 60/2009 regarding some measures to implement the First Home program is represented by the “proportional sharing of risks and losses between the Romanian State, represented by the Ministry of Finance through the FNGCIMM, and the financier”. For this reason, in the credit contracts granted through Prima Casă, the state assumed a share of the risk that the banks assumed in real estate loans, through the effect of the state guarantee.

According to him, counterparty debtors benefit from more favorable credit terms, becoming a particularly protected category, referring to the wide category of individuals who are credited without using the provisions of the emergency government order No. 60/2009.

“In this sense, we give the example of the fact that the beneficiaries of the First Home program are required to pay an advance of only 5% compared to the minimum 15% advance required in the case of loans for the purchase of a home under the provisions of the general law, and the cost of financing includes a margin of 2% per year, in most cases lower than the one that would be obtained as a result of the analysis of the debtor’s risk profile, conditions accepted by creditors precisely because they benefit from a partial guarantee of the state in case of debtor default,” says the ex-minister finance

See the letter sent by Florin Georgescu to the chairman of the Senate Budget Committee

In the case of the inclusion in the scope of Law No. 77/2016 of loans granted under the government program “Prima case”, the non-operational nature of the state guarantee arises, since both the obligation and the guarantee are canceled by law. From this point of view, the proportionality between the favorable conditions for granting credits under the “Prima case” program and the assumption of risks in a partnership that has broken up during the validity of the credit agreement, the acceptance of risk by only one party (the credit institution) without the guarantee element accepted by the state, has become unfair, says Florin Georgescu.

The consequences of adopting the legislative proposal would place a bank under a government prorated program in a risk-taking situation in a special way identical to the assumption associated with a loan made outside of that program in in both cases, the only way to recover the monetary claim is to issue a building warranty, according to BNR number 2.

Daniel Zamfir: Variable rate loans, whether tied to ROBOR or IRCC, are getting tougher

Variable rate loans, regardless of whether they are reported in ROBOR or IRCC, are becoming more difficult and challenging due to the evolution of the two indices over the last 12 months. Thus, both the evolution of the ROBOR index (the average interest rate on loans in RON granted on the interbank market, the level of which is reported by the BNR), and the IRCC, the base index that replaced ROBOR as of May 2, 2019, were significantly increased, with large the consequences for the payments that debtors must pay (including those who benefited from the provisions of the “Prima Casă” program, which later became “Noua Casă”, must pay them).

So, if at the beginning of August 2021 the 3-month ROBOR index, which calculates rates for borrowers who purchased real estate before 2019, was at a moderate level of 1.52%, then at the beginning of 2023 the level was 5 times higher. respectively 7.56%. in this interval, the growth rate increased, so that in October ROBOR 3M reached the highest level in the last 9 years, namely 8.21%, reached on October 31, 2022. In turn, IRCC, the base index used for loans in RON granted to individuals with a variable interest rate, which according to GEO 19/2019 replaced the ROBOR index, recorded explosive growth.

The formula for calculating the IRCC index, which is related to completed transactions, as opposed to ROBOR, which is calculated by averaging quotes, generates significantly lower IRCC values ​​relative to ROBOR. Following the daily values ​​released by the BNR for IRCC, the IRCC index is expected to continue to rise, thus creating additional pressure, particularly for borrowers who accessed the First Home/New Home program after 2019.

The context of explosive interest rate growth and the fact that First Home/New Home programs involve the use of variable interest rates, depending on ROBOR or IRCC, creates enormous volatility for borrowers. Given the fact that often as a result of the explosive evolution of the two monetary indices, IRCC and ROBOR, the monthly payment obligations of the debtor-beneficiaries of the Noua Casa program increased by more than 50%, and the fact that these threshold increases were maintained for at least 6 months, the exclusion of this category of debtors from the category of beneficiaries of payment regulation is completely discriminatory. It is clear that an increase in the rate of more than 50% represents an additional risk that is much higher than what the debtor could foresee when concluding the loan agreement (if he is also a beneficiary of the “First Home” program, which later became the new Home), and in that same time, a clear situation of unpredictability

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