REGULATION WATCH- Mortgage finance companies can now lend up to 15% of their capital base to an individual household, up from 10% previously, Financial Regulatory Authority (FRA) boss Mohamed Omran said in a statement (pdf). Data has shown that most families opt for mortgages to purchase larger homes in state-sanctioned social housing projects, but smaller mortgage finance players were unable to hand out loans for these purchases without exceeding the original limit. Mortgage finance players will also be able to dole out up to 30% of their capital to households seeking mortgages for non-residential properties, up from a previous 20%, Omran added. The authority decided to scale back the restrictions on portfolio concentration for mortgage providers after reviewing this data and the regulations with the Egyptian Mortgage Federation.

Other restrictions for mortgage lenders: Under the executive regulations of the Mortgage Finance Act, mortgage lenders are only allowed to take on debt up to 25x their equity base as a risk management precaution, and maintain a capital adequacy ratio of 12% and a level of liquidity of no less than 10% of current liabilities, Omran said.

The FRA also approved in principle the creation of a “real estate guarantee registry” through an amendment to the Mortgage Finance Act, Omran announced. The registry will be administered by the regulator and will contain information on real estate transactions, including data on guarantee providers and any write-offs made by financiers, to better protect all parties involved.

In other mortgage finance news: Heirs can now claim ownership of social housing applications submitted by deceased individuals before their death, under new Housing Ministry rules cited by Al Shorouk. This is a new service introduced through the Mortgage Finance Fund’s online portal, which also now allows homebuyers to submit proof they’ve paid installments in case their lenders suspend credit due to outstanding payments.