The commission for granting a mortgage loan is reduced when the loan is repaid early, if its amount depends on the duration of the contract, according to the Supreme Court resolution adopted on Wednesday.
The question regarding this case was sent to the Supreme Court by the District Court in Szczecin last summer. He asked whether the commission for granting a housing loan is proportionally reduced in the event of early repayment of the loan, or whether it is a cost not related to the term of the contract.
The Supreme Court was waiting for the decision of the CJEU
The Civil Chamber of the Supreme Court dealt with this question already in January this year, but then decided to suspend the case. The panel of three judges of the Civil Chamber – Beata Janiszewska, Maciej Kowalski and Marcin Łochowski – then decided to wait for the decision of the Court of Justice of the EU on a question submitted by an Austrian court on similar issues. In September 2021, the court of Austria asked the question to CJEU against the background of a lawsuit between an association defending consumer interests and one of the banks, which included a clause in the concluded credit agreements for the purchase of real estate that “additional costs, the amount of which is independent of the duration of the contract, will not be reimbursed, even in a proportionate way” .
The Court of Justice of the EU ruled in this case on February 9 this year. The ruling stated that “the consumer’s right to benefit from a reduction in the total cost of the loan in the event of early repayment of a loan for the purchase of real estate does not include costs independent of the duration of the contract”. “The consumer may only demand a reduction in interest and costs depending on the duration of the loan agreement” – ruled the CJEU. As the CJEU communicated at that time, “the right to a reduction is intended to adapt the loan agreement to early repayment”. Therefore, this right does not cover costs which, regardless of the duration of the contract, are borne by the consumer to the lender or to a third party for services that have already been fully paid at the time of early repayment.
Recurring and one-off costs
However, in the question of the Szczecin court addressed to the Supreme Court, the justification for which in December last year reached PAP, it was about the interpretation of Art. 39 of the Act on Mortgage Loans and Supervision of Mortgage Loan Brokers and Agents, which states that “if the entire mortgage loan is repaid before the date specified in the mortgage loan agreement, the total cost of the mortgage loan is reduced by interest and other costs of the mortgage loan for the period for which the duration of this contract was shortened, even if the consumer incurred them before the repayment. In this justification, it was admitted that the provision results in the division of credit costs into those of a periodic nature and those of a one-off nature – “only those costs that are periodic are subject to a proportional reduction”. “So those (costs) whose repayment was spread over time or their amount depends on the period for which the loan agreement was concluded” – added. The previously adopted interpretation of the analogous provision of the Consumer Credit Act was indicated as supporting the proportional reduction of the commission in such cases as well in the justification of the question. That issue was resolved after another CJEU ruling was issued in September 2019. It showed, among others, that in the event of early repayment of a consumer loan, the bank must reimburse all its proportionately reduced costs, including the commission and preparation fee. Bank representatives argued that the interpretation of the provisions on consumer loans cannot be transferred to mortgage loans, where some costs – such as commission or the cost of the survey – are independent of the period for which the loan was granted, and depend on other factors, including the amount credit and property values. Therefore – according to this interpretation – they should not consist in reimbursement regardless of the moment of repayment of the loan. The Szczecin court pointed out that the division of loan costs into periodic and one-off involves a certain risk, because “the lender could try to minimize the costs depending on the duration of the contract, charging the borrower who is a consumer with higher one-off costs for concluding the contract – e.g. in the form of preparation fees and commissions – payable at the time of its conclusion.
The Supreme Court sided with the clients
This problem was also noticed by the CJEU in its February decision. “In order to ensure that consumers are protected against abuse, national courts should ensure that the costs which are imposed on the consumer irrespective of the duration of the credit agreement do not objectively constitute the remuneration of the creditor for the temporary use of capital or for benefits to the consumer which, in at the time of the early repayment have not yet been met. He added that the bank is “obliged to specify whether the costs are recurring or not.” On Wednesday, after the case was suspended, in the resolution adopted by the SO in Szczecin, the Supreme Court stated that “the commission for granting a mortgage loan is reduced pursuant to Article 39(1) of the Act on Mortgage Loans and Supervision of Mortgage Loan Brokers and Agents, if its amount depends on the duration of the contract. The resolution was adopted on Wednesday in closed session. There is no written justification for it yet.
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