Mortgage lenders, whether financial institutions or banks, are firms that must be authorised and registered to carry out their activities. Who regulates mortgage lenders will vary from country to country, but it is most likely to be a public supervisory authority that carries out periodic assessments and appraisals of the sector and individual entities. In Spain, mortgage lenders are regulated by the Bank of Spain which is the national central bank that supervises the country’s banking system.
Prior to 2019, European mortgage lenders were not subject to sufficiently stringent regulatory supervision. Changes were put in place when the European Union proposed a Mortgage Credit Directive granting mortgage borrowers greater transparency throughout the whole process to avoid abusive practices from some banks. The regulations also oblige companies or individuals claiming to be an expert in the field, such as banks, brokers, solicitors, accountants or estate agents, to be qualified and licensed to provide their services in Spain. This includes getting certified and passing sector-relevant examinations among others.