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Mortgage loans: the new government measure that could encourage banks to grant more loans - La Nacion Propiedades
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www.lanacion.com.ar
February 15, 2025
It was published in the Official Gazette and seeks to consolidate the mortgage credit market through the creation of a special regime for the public offering of mortgage financial trusts.
By Maria Josefina Lanzi
A new measure is established so that banks can give more loans
The National Securities Commission (CNV), the regulatory body for the capital market in Argentina, established the creation of a special regime for the public offering of mortgage financial trusts . This measure was published on Wednesday 12 in the official bulletin and would eventually allow banks to grant more mortgage loans , since it introduces measures that promote a secondary loan market, which allows banks to improve funding.
“This is excellent news for the real estate market, because it will translate into a greater volume of loans granted ,” says Fabián Achával of the real estate agency of the same name. And Federico González Rouco, an economist at the consulting firm Empiria and an expert in housing, also believes that “this is very good news because it speeds up and simplifies the process of discharging mortgages and raising funds to provide new financing to banks. In addition, they are laying the foundations for a mortgage market with greater volume .”
Before going any further, it is important to clarify what a secondary mortgage market is. When granting mortgage loans for 20 or 30 years, banks need significant liquidity and funding, which they often do not have. To achieve this, secondary markets are created: banks sell mortgages (which they previously granted to individuals) to long-term investors - such as retirement funds or pension insurance - who buy the loans from banks. These then create a trust with these credits, convert them into financial assets and inject them into the capital market to generate profits. This process is known as the "securitization of mortgages," something that gives banks more liquidity, since instead of waiting 20 or 30 years for the loan to be repaid, they receive it quickly from these funds, and thus have greater capacity to lend money and continue granting mortgage loans.
The National Securities Commission (CNV) established the creation of a special regime for the public offering of mortgage financial trusts Shutterstock
The new general regime published by the CNV - through General Resolution 1053 - implements a more agile and simplified securitization system, "with the aim of promoting and consolidating a robust and sustainable mortgage credit market over time," says the CNV statement. It is important to clarify that this regime applies to those vehicles or entities that invest in mortgages, mortgage notes, mortgage loans or similar instruments.
Specifically, the measure ensures that:
The measure seeks to promote and consolidate a robust and sustainable mortgage loan market over time.Image Point Fr - Shutterstock
However, since last November, a piece of news has been worrying the real estate market: 12 banks have raised the interest rates on mortgage loan lines . “The linear explanation is that, on the one hand, there is a great demand that grew very quickly and, on the other, it is expensive for banks to fund mortgage loans, since these are loans with very high tickets that require the existence of a secondary market in order to be able to finance them ,” says González Rouco. These markets are created with tools such as the titling of portfolios or securitization, large long-term investors, such as retirement funds or pension insurance, who buy mortgages and sell them again with interest. The purchase of mortgage loans is a great business for them, since they guarantee a return for 30 years.
“Today, in Argentina, this implies a great financial sophistication , but that could be strengthened by the lifting of the cepo, which increases the financing capacity, since it opens the doors to foreign investors,” explains González Rouco, who adds that the interest rates on loans in Argentina are more attractive, since they are higher than those of other countries, such as Chile. This reality is explained by the risk involved in investing in our country, but “if you see that the default on UVA loans in our country is 1%, the interest rates are 7.4% on average, in addition to the fact that we are betting on normalization because there is talk of eliminating the cepo, everything speaks of encouraging investments.”
The new measure of the CNV could boost this secondary market and help the funding of banks. “We are working to make the procedures and processes within the capital market more flexible, in line with the deregulation promoted by the National Government,” said Roberto E. Silva, president of the CNV, and in this sense, he emphasized: “We want to support these measures that are important for the development of mortgage credit , and for access to housing for Argentines.” Finally, he said that “we are proud to report this type of regulations, which not only encourage, but also promote the growth of the capital market.”
Alan Daitch, CEO of the Tasa Tasa platform, ventures to project “a tripling in the granting of mortgage loans because this measure is in line with the regulatory changes we need to get mortgage credit to take off, allowing many more people to fulfill their dream of owning a home.”
Property sales have grown by 35% in 2024 in CABA, with almost 55,000 transactions in the citySantiago Filipuzzi
“The measure facilitates the creation of a secondary market, so that banks can inject more liquidity into the mortgage market,” says Achával, who explains that banks turn around and sell the mortgage to investors who earn a return. “They stop having risk, they recover money and can lend again,” he adds. The broker explains that, by securitizing, the risk is also mitigated for large investment funds, since they buy a “credit portfolio,” so, if there is a default in the repayment of a loan, the risk is diversified. “ Securitization occurs in serious countries, so the existence of a secondary market is excellent news , as long as it is well regulated,” adds Achával.
According to a banking entity consulted by LA NACION , this measure by the CNV facilitates some issues related to securitization, although there are other necessary factors that must continue to occur in order to securitize mortgage loans: macroeconomic stability, lower inflation, reduction of rates, among others.
www.buysellba.com
Source:
Créditos hipotecarios: la nueva medida del Gobierno que podría impulsar que los bancos otorguen más préstamos
Fue publicada en el Boletín Oficial y busca consolidar el mercado de créditos hipotecarios a través de la creación de un régimen especial para la oferta pública de fideicomisos financieros hipotecarios
www.lanacion.com.ar
February 15, 2025
It was published in the Official Gazette and seeks to consolidate the mortgage credit market through the creation of a special regime for the public offering of mortgage financial trusts.
By Maria Josefina Lanzi
A new measure is established so that banks can give more loans
The National Securities Commission (CNV), the regulatory body for the capital market in Argentina, established the creation of a special regime for the public offering of mortgage financial trusts . This measure was published on Wednesday 12 in the official bulletin and would eventually allow banks to grant more mortgage loans , since it introduces measures that promote a secondary loan market, which allows banks to improve funding.
“This is excellent news for the real estate market, because it will translate into a greater volume of loans granted ,” says Fabián Achával of the real estate agency of the same name. And Federico González Rouco, an economist at the consulting firm Empiria and an expert in housing, also believes that “this is very good news because it speeds up and simplifies the process of discharging mortgages and raising funds to provide new financing to banks. In addition, they are laying the foundations for a mortgage market with greater volume .”
Before going any further, it is important to clarify what a secondary mortgage market is. When granting mortgage loans for 20 or 30 years, banks need significant liquidity and funding, which they often do not have. To achieve this, secondary markets are created: banks sell mortgages (which they previously granted to individuals) to long-term investors - such as retirement funds or pension insurance - who buy the loans from banks. These then create a trust with these credits, convert them into financial assets and inject them into the capital market to generate profits. This process is known as the "securitization of mortgages," something that gives banks more liquidity, since instead of waiting 20 or 30 years for the loan to be repaid, they receive it quickly from these funds, and thus have greater capacity to lend money and continue granting mortgage loans.
The National Securities Commission (CNV) established the creation of a special regime for the public offering of mortgage financial trusts Shutterstock
The new general regime published by the CNV - through General Resolution 1053 - implements a more agile and simplified securitization system, "with the aim of promoting and consolidating a robust and sustainable mortgage credit market over time," says the CNV statement. It is important to clarify that this regime applies to those vehicles or entities that invest in mortgages, mortgage notes, mortgage loans or similar instruments.
Specifically, the measure ensures that:
- “There is the possibility of reducing the dissemination period to one day, when the offer is directed to qualified investors, compared to the three days established in the general regime,” the statement highlights. It is worth clarifying that, if an entity establishes a trust in the capital market, it is obliged to have three days of dissemination/publicity, before placing it; time that, from now on, would be reduced (provided that the offer is directed to qualified investors).
- “It makes it possible to reopen the placement for a period of up to two years from the original placement, which is not permitted under the general regime, where the results of the tender were final. From now on, if a percentage of the authorized amount remains unplaced, the placement may be reopened under the previously established conditions,” the statement says. In other words, if in a first issue 100% of the authorized fiduciary securities are not placed, issuers will now have more flexibility, since they will be able to place the remainder without carrying out a new issuance process.
- “Another important benefit is the possibility of issuing additional trust securities with automatic public offering, which was also not possible under the general regime,” the statement added. This means that, in addition to the authorized amount, the trust can issue new securities more quickly and without additional procedures, since it does not need to request a new authorization from the National Securities Commission (CNV).
The measure seeks to promote and consolidate a robust and sustainable mortgage loan market over time.Image Point Fr - Shutterstock
Will the supply of mortgage credit increase?
The measure comes at a time when the real estate market is experiencing a tailwind, among other factors, due to the resurgence of mortgage loans in April of last year, led by 24 banks. Since then, property sales have grown by 35% in 2024 in CABA, with almost 55,000 transactions. Purchases with mortgages, on the other hand, went from 115 in June to 1,130 in December in the city.However, since last November, a piece of news has been worrying the real estate market: 12 banks have raised the interest rates on mortgage loan lines . “The linear explanation is that, on the one hand, there is a great demand that grew very quickly and, on the other, it is expensive for banks to fund mortgage loans, since these are loans with very high tickets that require the existence of a secondary market in order to be able to finance them ,” says González Rouco. These markets are created with tools such as the titling of portfolios or securitization, large long-term investors, such as retirement funds or pension insurance, who buy mortgages and sell them again with interest. The purchase of mortgage loans is a great business for them, since they guarantee a return for 30 years.
“Today, in Argentina, this implies a great financial sophistication , but that could be strengthened by the lifting of the cepo, which increases the financing capacity, since it opens the doors to foreign investors,” explains González Rouco, who adds that the interest rates on loans in Argentina are more attractive, since they are higher than those of other countries, such as Chile. This reality is explained by the risk involved in investing in our country, but “if you see that the default on UVA loans in our country is 1%, the interest rates are 7.4% on average, in addition to the fact that we are betting on normalization because there is talk of eliminating the cepo, everything speaks of encouraging investments.”
The new measure of the CNV could boost this secondary market and help the funding of banks. “We are working to make the procedures and processes within the capital market more flexible, in line with the deregulation promoted by the National Government,” said Roberto E. Silva, president of the CNV, and in this sense, he emphasized: “We want to support these measures that are important for the development of mortgage credit , and for access to housing for Argentines.” Finally, he said that “we are proud to report this type of regulations, which not only encourage, but also promote the growth of the capital market.”
Alan Daitch, CEO of the Tasa Tasa platform, ventures to project “a tripling in the granting of mortgage loans because this measure is in line with the regulatory changes we need to get mortgage credit to take off, allowing many more people to fulfill their dream of owning a home.”
Property sales have grown by 35% in 2024 in CABA, with almost 55,000 transactions in the citySantiago Filipuzzi
“The measure facilitates the creation of a secondary market, so that banks can inject more liquidity into the mortgage market,” says Achával, who explains that banks turn around and sell the mortgage to investors who earn a return. “They stop having risk, they recover money and can lend again,” he adds. The broker explains that, by securitizing, the risk is also mitigated for large investment funds, since they buy a “credit portfolio,” so, if there is a default in the repayment of a loan, the risk is diversified. “ Securitization occurs in serious countries, so the existence of a secondary market is excellent news , as long as it is well regulated,” adds Achával.
According to a banking entity consulted by LA NACION , this measure by the CNV facilitates some issues related to securitization, although there are other necessary factors that must continue to occur in order to securitize mortgage loans: macroeconomic stability, lower inflation, reduction of rates, among others.
www.buysellba.com
