Bill to exempt credit-union-style cooperative credit sections from the mortgage loan law

Automatic summary, not yet reviewed

1. The bill proposes to reform Law 5/2019, which regulates real estate credit contracts. Its authors argue that, because the law does not expressly exclude cooperatives with a credit section, it forces them to meet requirements designed for banks and credit cooperatives.
2. According to the statement of reasons, a cooperative's credit section only lends money to its own members. This is self-financing, not a professional financial service, and these entities are governed by cooperative laws, not banking legislation.
3. The bill would add a new provision to Article 2 of Law 5/2019 so that the law would not apply to loans made by cooperative credit sections to their own members, provided the cooperative's corporate purpose is different from professionally providing financial services.
4. If passed, the law would enter into force the day after its publication in the Official State Gazette (Boletín Oficial del Estado).

Who it affects

• Cooperatives with a credit section (agricultural, housing, worker cooperatives, etc.): They would no longer be subject to Law 5/2019 for loans to their members through their credit section.
• Members of those cooperatives: They would keep receiving loans from their cooperative's credit section under current conditions, outside the scope of Law 5/2019.
• Banks, financial institutions and credit cooperatives: They would still have to comply with the law, since they lend on a professional basis.

Words worth knowing

Crédito inmobiliario

A loan to buy or renovate real estate, such as a home, often secured by a mortgage.

Cooperativa con sección de crédito

A cooperative whose corporate purpose is not financial (agricultural, housing, etc.) but which has an internal part, the credit section, that lends money only to its members.

Cooperativa de crédito

A financial institution that professionally grants loans, such as rural savings banks. It should not be confused with a cooperative with a credit section.

Objeto social

The activity for which a company or entity is incorporated, as stated in its bylaws.

Proposición de ley

A bill introduced by members of Congress to become law. While it is being processed, it is not in force.

It summarizes the text as it was introduced. It is written by artificial intelligence and may contain mistakes: the official text is what counts. Read the official text · How we make summaries