Renegotiation of mortgage loan contracts pursuant to the 2023 Budget Law
Renegotiation of mortgage loan contracts pursuant to the 2023 Budget Law
The new Budget Law (Law No. 197 of December 29, 2022), Article 1, paragraph 322, provides that borrowers who meet the requirements listed below, and until December 31, 2023, have the right to obtain the renegotiation of the mortgage for a period equal to the remaining duration of the loan or, with the client's agreement, for a shorter period, with the application of a nominal annual interest rate.
fixed not exceeding the rate obtained based on the lower of the 10-year euro IRS and the euro IRS with a duration equal to the remaining duration of the mortgage, or, if not available, the quotation of the IRS for the previous duration, as reported on the ISDAFIX 2 page of the Reuters circuit on the date of renegotiation, increased by a spread equal to that indicated, for the purpose of determining the rate, in the mortgage contract.
Furthermore, the borrower and the credit holder may agree that the renegotiation under the terms described above may also involve the extension of the mortgage repayment plan for a maximum period of five years, provided that the remaining duration of the mortgage at the time of renegotiation does not exceed twenty-five years; in this latter case, the borrower's request will be subject to a preliminary assessment by the credit holder, who may accept or reject such requests at their sole discretion.
The requirements set forth by Law to request a renegotiation of the mortgage under the terms described above are:
- mortgage loan signed before the law came into force (i.e. before 01/01/2023);
- borrowers who have signed, or assumed even following subdivision, a mortgage loan contract for the purchase or renovation of residential properties;
- contract signed with variable rate and installment for the entire duration of the contract;
- mortgage with an original disbursed amount not exceeding €200,000.00
- presence of certification, issued by an authorized entity, of the Equivalent Economic Situation Indicator (ISEE) not exceeding €35,000 at the time of submitting the renegotiation request of the mortgage;
- no history of late payments of mortgage installments, unless otherwise decided at the sole discretion of the credit holder.
Procedures for submitting a mortgage negotiation request:
The request to renegotiate the mortgage must be accompanied, at the time of submission, by documents required to verify that the borrower meets the criteria established by the 2023 Budget Law. Specifically, these must include at least the identity documents of all borrowers and the Equivalent Economic Situation Indicator (ISEE), updated as of the request date. The request and the attached documents can be sent by the borrower to one of the following email addresses, depending on the Credit Holder:
After a preliminary formal check, the request, along with the submitted documents, will be forwarded by doNext to the Credit Holder or to the delegated decision-making body for further assessment and resolution.
Please note that, due to the recent publication of the relevant regulation, we are still awaiting potential additional implementation or regulatory instructions that may further clarify or define the procedures involved.
doNext will communicate, as soon as possible, the outcome of the evaluation and/or the decisions made by the competent authorities.