Already on December 18, the amended provisions of the Consumer Credit Act enter into force. They can change a lot in the Polish credit landscape. For better or for worse? This is explained by Comperia.pl web comparison experts.
On the one hand, the terms of the loans are to be more transparent, and the borrower will receive from each bank the same form detailing the parameters of the requested commitment. In addition, he will have 4 days more than before to decide whether he really needs the loan he has already received or wants to return it. On the other hand, the 5% limit will disappear. total fees and credit fees, and the option of charging banks for early repayment of cash loans will return (in certain cases). This is how you can describe the changes in the Consumer Credit Act, which will come into effect on December 18th. Analysts of the financial comparison website Comperia.pl discuss them in more detail.
What is consumer credit and what will it be?
First, the classification of some obligations changes. Up to now, loans up to $ 80,000 have been subject to the provisions of the Act, and from December 18, a consumer loan agreement will mean a liability of up to $ 255,550. The Act applies primarily to cash loans, but some of its provisions will also apply to mortgage loans and those in the personal account.
Everything in black and white?
The amended Consumer Credit Act particularly emphasizes the need to reliably inform borrowers of all conditions of the contract. This is why, before signing the loan agreement, each lender or credit intermediary will be required to provide the client with a detailed list of costs and terms of the loan. Importantly, the person looking for a loan will get the SAME form with the features of the offer in each bank and at each intermediary. This should help you compare the proposals of individual banks that are trying to hide some fees. The standardized form of the information form is an attachment to the act, so banks will have to use it when presenting their offers.
What will this document contain?
This is precisely determined by art. 13 of the Act. Among others, it will be: the total loan amount (in currency as at the date of providing information as regards foreign currency loan), rules for determining the currency spread and information on its impact on the loan amount and installments, loan repayment date and manner, repayment rules (illustrative information on the amount of installments or the amount of interest), the total cost of the loan (margin, interest rate and rules for its determination as well as the conditions for changing it), terms of withdrawal, early repayment terms and effects of late repayment.
The loan agreement should also contain a lot of details. This is not a surprise. It is interesting, however, whether the Legislator’s intention will actually be realized.
It all depends on time
By 96 hours – from 10 to 14 days – the borrower’s withdrawal from the loan agreement has been extended without giving a reason. Even if the customer returns the borrowed funds, interest will be accrued for these several days of the loan. If, in turn, the bank refuses to grant a person a loan, he will have to justify his decision by indicating the database on which he relied. However, the provisions described do not apply to mortgage loans.
The bad news is that banks will be given the right to charge commissions for overpayment or early repayment. It will be able to amount to max. 0.5 percent. the amount given, if there is less than a year until the end of the contract, already 1%, when the loan should be repaid for at least 12 months. Fortunately, this commission can be charged only for loans with a fixed interest rate and only if the amount of the loan repaid in the next 12 months is higher than three times the average monthly salary in the enterprise sector from December of the year preceding the year of repayment. As three times the said rate is about 11 thousand. zlotys, so you would have to pay extra to be afraid of the commission.
Higher loan costs?
In a week, the obligation disappears so that fees and commissions related to the loan do not exceed 5 percent. loan amount. On the one hand, this may cause an increase in credit costs, on the other – also now 5% is bypassed. Additional costs for borrowers are, among others compulsory insurance, not counted to the current 5% limit