Entities must have a debt renegotiation policy and late payment interest on consumer loans is limited.


This Tuesday, the Council of Ministers approved the draft law on credit administrators and buyers that regulates, among other matters, the renegotiation of doubtful loans and the purchase and sale of portfolios of non-performing loans that credit institutions regularly carry out.

This law transposes the European directive on this activity, thus establishing common standards for this market, and modifies, in turn, the Law on consumer credit contracts (Law 16/2011) and the Law on real estate credit contracts (Law 5 /2019).

The regulatory project regulates, first of all, the activity of administration of doubtful credits, which consists of the collection or renegotiation of doubtful credits, which will become a reserved activity and will require prior authorization from the Bank of Spain.

“In order to protect consumers, requirements to obtain this authorization are established to have an adequate internal complaints management system, as well as an adequate policy that guarantees the protection and fair treatment of borrowers,” says the Ministry of Economy through a statement.

Likewise, the sale and purchase of doubtful credits and doubtful credit contracts carried out by credit institutions of the European Union that are subject to Spanish regulations is regulated, establishing common rules to establish the operation of this market.

The objective is also to ensure the maintenance of the conditions and rights of borrowers and to transfer the obligations of transparency, protection and information, including compliance with the codes of good practices to which the initial creditor adhered.

The regulatory project establishes additional guarantees for the protection of borrowers, which oblige both buyers and services to provide “adequate” treatment and “sufficient” information, in addition to having a customer service for the borrower and appropriate extrajudicial claims.

In order to ensure compliance with these obligations, the Bank of Spain will supervise credit buyers and services, also establishing the corresponding regime of infractions and sanctions.

In the sectoral regulations for consumer credit and real estate credit, the obligation is introduced for lenders to have a debt renegotiation policy, and must offer the borrower, before the initiation of legal actions or the demand for full payment of the debt, measures aimed at reaching renegotiation agreements.

The standard also establishes special conditions for borrowers in a situation of economic vulnerability, who are the beneficiaries of the Minimum Living Income (IMV) and people who are below minimum income thresholds and in whom certain additional situations of vulnerability occur. .

In these cases, the lending entity that is going to sell the doubtful credit to a third party must offer the borrower the possibility of repaying the credit by applying a partial write-off or forgiveness aligned with the estimated amount of the sale of the credit.

Additionally, additional debtor protection measures are introduced in the Consumer Credit Law, aimed at improving the information and protection of these clients. Thus, with this objective, the late payment interest to be charged in cases of non-payment by the consumer is limited; The cases of modification of the interest rate in contracts of indefinite duration (as in the case of ‘revolving’ cards) are defined, allowing clients not to accept the increases or cancel the contract.

Finally, the conditions of compensation for early repayment are clarified in the case of financing linked to the purchase of goods or services.

The Ministry of Economy affirms that this regulatory project “reinforces” the protection of financial consumers, especially those who are in a situation of economic vulnerability, “guaranteeing that their rights are respected and they are offered solutions to face their debts.”

Likewise, it defends that the draft law, which will be published in a public hearing to collect the opinions of economic operators, favors financial stability, “making it easier for financial entities to sell their credit portfolios, allowing them to clean up their balance sheets and improve their solvency.” “.