Understand how the framework of guarantees can facilitate credit – 07/06/2023 – Market

Last Wednesday (5), the Senate approved the so-called guarantee framework. Considered fundamental by the Lula government to reduce the cost of borrowing in the country, the bill could directly impact the real estate credit market by making the use of real estate as collateral for loans more flexible.

The proposal, which is now returning to the Chamber of Deputies for further consideration, also aims to facilitate the enforcement of debts by banks and other creditors in the event of default.

The original text was sent at the end of 2021, still under the government of Jair Bolsonaro (PL), and has the support of the current management in view of the expectation of positive effects on the credit market.

Understand the five main points of the proposal approved by the Senate and how the project can reduce the cost of credit in Brazil.

What is the Guarantee Framework?

The Legal Framework for Loan Guarantees is a bill that aims to change the rules on guarantees granted for borrowing. The proposal facilitates banks and other institutions to execute debts in case of default. The objective is to reduce the risk of the creditor and, therefore, to reduce the cost of borrowing.

What changes in the cases of real estate subject to guarantee?

The version of the Marco das Garantias that advanced in the Senate makes it possible for the same property to be given as guarantee in more than one request for financing.

Currently, a property of R$ 1 million is restricted to a single loan, until discharge. The rule is valid even if the credit operation has a value lower than that of the good offered as collateral.

The approved text gives the possibility for the same property to have its value divided and serve as collateral in various financing. Loans can be taken out at different banks, giving consumers the possibility to search for more advantageous interest rates.

Another change allows land in an urban area to be offered in return for financing works to be carried out on the same lot. This change was inserted through an amendment by Senator Vanderlan Cardoso (PSD-GO).

How can Marco das Garantias unlock real estate credit?

The Ministry of Finance’s bet is that the possibility of using the same property in more than one financing request will unlock credit in the country and reduce the cost of loans.

According to data from Abecip (Brazilian Association of Real Estate Credit and Savings Entities), only R$ 2 billion were transacted in credit agreements involving real estate as collateral.

The value represents a small portion if compared to the total movement in financing, which is R$ 1 trillion.

Analysts point out that the greater facility for taking credit in this model can inject between R$ 3 trillion to R$ 4 trillion into the national economy.

Another aspect that may favor savings is the improvement in the registration system of guarantees on movable property proposed by the project.

Will creditors be able to collect assets given as collateral without going to court?

No. Although the possibility of extrajudicial collection was in the original idea of ​​the project, the senators rejected the passage.

Today, the creditor needs to go to court to collect the assets given as collateral in the event of default —the exceptions involve real estate. The idea of ​​the project rapporteur, Weverton Rocha (PDT-MA), was to dispense with this need to judicialize the cases.

In addition, the project would extend to movable property, such as vehicles, the possibility of extrajudicial collection. That is, judicial or extrajudicial titles previously protested could be executed in a notary.

With the rejection of the senators to the section on dejudicialization, the topic will be discussed in another bill authored by Senator Soraya Thronicke (Podemos-MS), which is already being processed by the CCJ (Commission on Constitution and Justice).

Pledge of movable property by Caixa

The version of the Marco das Garantias approved by the senators restored Caixa Econômica Federal’s monopoly on the attachment of movable assets, such as jewelry, watches and works of art.

In this way, only the public bank has the right to operate lines of credit with this modality —a way to prevent the greater exploitation of this niche from opening up space for abusive practices and loan sharking.