Foreign currency mortgage contract ruled to be invalid by court
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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.