Following a constitutional complaint, a case has been initiated in the Constitutional Court regarding the compliance of Article 8.4, Part Ten, Clause 2 of the Consumer Rights Protection Law with the first sentence of Article 91 of the Constitution of the Republic of Latvia, the Constitutional Court reports.
8 of the Consumer Rights Protection Law.4 article provides for the mortgage borrower’s protection fee, the proceeds of which are used to pay loan interest compensation to mortgage borrowers.
According to the contested norm, the mortgage loan holder eligible for the application of this article is the consumer with whom the fee payer has concluded a mortgage loan agreement, if the balance of the mortgage loan does not exceed 250,000 euros.
The applicants’ mortgage loan balance exceeds 250,000 euros, therefore, according to the contested norm, they have no right to receive interest compensation for this loan. All other conditions necessary to receive this compensation, if they meet. The applicants believe that with the ban on them receiving the mentioned compensation, unjustified different treatment is allowed compared to other borrowers, who also have a valid mortgage loan agreement concluded until October 31, 2023 with a variable interest rate. Thus, the contested norm violates their fundamental rights contained in the first sentence of Article 91 of the Constitution.
The Constitutional Court invited the institution that issued the contested norm, the Saeima, to submit a response letter with an outline of the factual circumstances of the case and the legal justification by June 26, 2024.
The deadline for preparing the case is September 26, 2024. The court decides on the type and date of the case review process after the case is prepared.
Tags: case initiated payment loan interest compensation mortgage borrowers
