A/HRC/25/54 48. Measures to regulate financial markets and institutions. The deregulation of financial markets, along with policies prioritizing homeownership, has had adverse impacts on many urban-poor households.52 Sub-prime loans, payment defaults and foreclosures have led to tenure insecurity and evictions in several countries.53 Often, financial institutions, including microcredit institutions, charge higher interest rates to the poor to mitigate the heightened risk of default. In some cases, lenders have aggressively targeted low-income households for loans with exploitative terms, without explaining the terms and conditions, and ignoring their ability to repay.54 States should prohibit predatory lending practices and adopt regulations to ensure that mortgage payments are commensurate with income levels and do not compromise the satisfaction of other basic needs. Regulations should also mandate the full disclosure and communication of loan terms to applicants in accessible formats and languages.55 49. Regulatory safeguards should be put in place to protect households facing default and foreclosure, including prohibiting eviction until the household has access to alternative adequate housing. In England and Wales, a pre-action protocol for possession claims obliges lenders and borrowers to follow procedures aimed at ensuring that repossession is a last resort after all reasonable attempts to resolve the situation have failed.56 In Richmond, California, the municipality voted to use its powers of eminent domain to seize mortgages of households that have defaulted or are at risk of default, when the investor refuses to sell. Under the scheme, the City pays the investor the current market value for the mortgage, often considerably less than the amount owing, and then supports affordable refinancing options for the homeowner.57 A decree-law in Andalucía, Spain, currently under appeal, allows the local Government to expropriate empty residences that have been repossessed by banks and developers in order to house families who have lost their homes.58 F. Combating discrimination on the basis of tenure 50. The principle of non-discrimination is a pillar of international human rights law.59 Discrimination constitutes any distinction, exclusion, restriction or preference or other differential treatment that is directly or indirectly based on prohibited grounds of 52 53 54 55 56 57 58 59 16 See A/67/286 and A/68/289. See, for example, Special Rapporteur’s report on her mission to the United States of America, A/HRC/13/20/Add.4, paras. 47–48. See Elvin K. Wyly, et al., “American Home: Predatory mortgage capital and neighbourhood spaces of race and class exploitation in the United States”, Swedish Society for Anthropology and Geography, 88B, pp. 105–132. In this context, see Gudwana v. Steko Development CC and Others, judgement of South African Constitutional Court, 11 April 2011. Available from www.justice.gov.uk/courts/procedure-rules/civil/protocol/prot_mha. Lydia Depillis, “Richmond’s rules: Why on California town is keeping Wall Street up at night”, The Washington Post, 5 October 2013. Available from www.washingtonpost.com/blogs/wonkblog/wp/2013/10/05/richmonds-rules-why-one-californiatown-is-keeping-wall-street-up-at-night/. Comunidad Autónoma de Andalucía, Decree-Law 6/2013; Navarra, Autonomous Law 24/2013. Under these decrees, lenders receive 2 per cent of the value of the property each year and can recover legal possession after three years. Both measures are currently under appeal by the central Government in the light of the Constitutional protection of property. International Covenant on Economic, Social and Cultural Rights, art. 2, para. 2.