Foreign currency mortgage contract ruled to be invalid by court

Thousands of foreign currency household mortgage contracts may turn out to be invalid following a Budapest Court decision (Hungarian, pdf) that cancelled an OTP Bank contract on December 7, 2012.  Dénes Lázár, a founder of PITEE, a consumer protection organisation in Hungary told Atlatszo.hu in an interview that the Court’s decision is setting a precedent, admitting the flaws of the Hungarian financial sector’s application of the law.  Mr. Lázár complained about the often irresponsible lending practices of Hungarian banks; he said if the Hungarian Financial Supervisory Authority (PSZÁF) had operated properly, it would have been able to stop massive amounts of citizens taking out foreign currency loans.

Read our interview in Hungarian