Mortgage and free loan sanction. What is worth knowing?

The free loan sanction has been gaining great popularity lately, especially in consumer disputes with banks and loan companies. The number of lawsuits in this respect is systematically growing and there are many indications that in 2025 this may be one of the most important topics in the area of ​​consumer loans. Most often it is talked about in the context of ordinary consumer loans, but mortgage owners also would like to be able to pay off their liabilities without interest. Do they have such an opportunity? Experts of the RynekPierwotny.pl portal explain these doubts.

Act on mortgage without a free loan sanction?

According to experts, it is worth checking whether the regulations provide for such a sanction for mortgage loans. The Act of 23 March 2017 on a mortgage and supervision over mortgage brokers and agents covers only mortgage loans granted from July 22, 2017 and does not provide for the possibility of using a free loan sanction or other solution similar to such sanction (described by Article 45 of the Consumer Credit Act).

– As you can see, the authors of the Mortgage Act did not decide to apply a free loan sanction, which in turn provides for the Act of 12 May 2011 on consumer credit (Journal of Laws 2024, item 1497, as amended). However, we must remember that the current Consumer Credit Act has regulated selected rules related to mortgage loans for some time. Such a rather provisional legal solution was applied before the introduction of the mortgage act – notes Andrzej Prajsnar, expert of the RynekPierwotny.pl portal.

Indicates that from December 18, 2011, Article 46 of the Consumer Credit Act was in force. This provision, repealed on July 22, 2017, said that: “In the event of a violation by the lender, Article 35, the consumer, after submitting the lender of a written statement, returns a loan without interest and other costs of credit due to the lender for the period of 4 years preceding the date of submitting this declaration and in the manner set out in the contract.”

Bank punished for mistakes in a mortgage contract

The analysis of historical regulations indicates that in the years 2011-2017 mortgage loans concerned a solution reminiscent of the current sanction of a free consumer loan.

– However, it is a solution less severe for banks than a free loan sanction currently used, among others for cash loans. The legislator in later repealed art. 46 of the Consumer Credit Act indicated that the right to use the “mortgage” of the free loan sanction expires after a year from the date of the contract, i.e. the final settlement of the parties – explains Andrzej Prajsnar.

Indicates that within the annual period indicated by the Act, the consumer must submit a written statement on the use of a free loan sanction.

– A key condition for the availability of a “mortgage” free loan sanction is the lender by a lender in a credit agreement secured by a mortgage or a faulty formulation in this agreement at least one of the elements of the content listed in art. 35 of the Consumer Credit Act or in art. 69 para. 2 of the Banking Act. Other negligence of the lender does not give the consumer the right to make a declaration and reduce credit costs – says Prajsnar.

Free loan sanction – there are no lawsuits, but not so numerous

As experts note, some law firms still encourage mortgage borrowers to take advantage of the free loan sanctions.

– However, it can be assumed that there are few action related to such a sanction and housing loan or mortgage. The restriction is not only the time of signing the contract (from December 18, 2011 to July 21, 2017), but also the maximum limit of the borrowed amount, which was set by the Consumer Credit Act (PLN 255,550). Let us remember that as early as the fourth quarter of 2011, the average value of the housing loan granted was PLN 207,571 (according to Amron Sarfin data). Later, this average was slowly growing – to PLN 238,956 in the third quarter of 2017 – says Andrzej Prajsnar.

It reminds that before the current Consumer Credit Act, the Act of 20 July 2001 on consumer loan was in force.

– This legal act from February 20, 2006 included consumer loans with a maximum value of PLN 80,000 for housing purposes. The so -called “Old Act on Consumer Credit”, in force until December 18, 2011, provided for a solution similar to the current free loan sanction (see: Article 15 of the Act of 20 July 2001 on consumer loan). However, the low limit of loan value for housing purposes covered by this act (only PLN 80,000) effectively limited the pursuit of claims by consumers – notes the expert.