UPDATE - Banks told to foot notary bill in mortgage aid program

Initiatives

The government will require banks to pay a notary fee for Hungarians who opt to participate in a state assistance program for borrowers with foreign currency-denominated loans, the government said on its website on Friday.

A decree by Public Administration and Justice Minister Tibor Navracsics requiring banks to pay the fee will soon be published, the government said.

The assistance program, launched on Friday, fixes the exchange rate for repayments on the loans and puts the difference between the fixed rate and the market rate on a separate forint account to be repaid later. The program's rate for Swiss franc-based loans -- once the most popular lending product in Hungary – is 180 forints to the franc, well under the market rate of around 240 on Friday afternoon.

The government said the notary fee would be fixed when the package was launched.

The Hungarian National Notary Chamber proposed earlier the fee to be set at HUF 10,000-20,000 per modified contract.

The decree by the public administration and justice minister also limits the increase for repayments on the separate forint accounts when the assistance program winds up at the end of 2014 to 15% over the last repayment under the program.

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