What benefits does the borrower have for a consumer loan?

 

Consumer credit is a special type of loan that has been fully regulated, granting it rights, rights and obligations of the parties to the loan agreement or repayment rules. The Consumer Credit Act gives many rights to the borrower. What?

 

The right to obtain credit terms and repayment schedule, withdraw from the loan agreement and terminate it – these are the basic benefits that the Consumer Credit Act gives to borrowers. 

 

What is consumer credit?

What is consumer credit?

Pursuant to the provisions of the Act, a consumer credit agreement is a credit agreement in the amount not exceeding USD 255 550 or the equivalent of this amount in a currency other than the currency, which the lender grants or promises to grant consumer credit to the consumer in the scope of its business activity. At the same time, a consumer loan agreement can also be any loan agreement not secured by a mortgage, which is intended for the renovation of a house or apartment in the amount of more than USD 255,000.

The consumer loan agreement will include:

  • credit agreement, concluded on the basis of the provisions of the Banking Act,
  • loan agreement,
  • revolving loan agreement, etc.

For example, if a loan is granted free of charge, without accruing interest or other charges, it will not be legally considered a consumer loan.

 

The borrower’s basic rights

The borrower

The conclusion of a loan agreement, which in law will be considered as a consumer loan agreement, means that the borrower receives numerous benefits. Already at the initial stage of applying for such a commitment, he has the right to receive a free draft contract at his request, which will take into account all the conditions for its granting. After granting the loan, the customer who has entered into a fixed-term loan agreement has the right at his request to receive the repayment schedule of principal and interest installments at any time.

 

A very important benefit for a customer taking out a consumer loan is that he can terminate the revolving credit agreement at any time, without additional charges, and the parties may specify a notice period of not more than a month in the agreement.

 

In addition, the consumer has the right under the existing provisions to withdraw from the consumer credit agreement without giving a reason within 14 days of the date of the contract. This period begins on the day of conclusion of the credit agreement or on the day on which the consumer receives the terms of the agreement and information on the right to withdraw or not.

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Conditions for obtaining a cash loan

A cash loan from a bank or credit unions is intended for customers who have a sufficiently high creditworthiness and are creditworthy, which can be confirmed in the credit databases. http://www.ristorantitreviso.net/swift-payday-loans/ for further clarification

The most important creditworthiness

The most important creditworthiness

A client applying for a cash loan at a bank or credit unions will be able to receive such financing only if he has sufficient creditworthiness. It identifies with the ability to repay the commitment made – the capital and accrued interest, according to the deadline specified in the contract.

The consumer is affected by how much he earns and how much he spends. Therefore, when applying for a cash loan, the amount of income and indicate from which sources they are obtained. Stable income, significantly exceeding the monthly expenses related to the maintenance of oneself and the family, apartment or car as well as the repayment earlier Loans and borrowings have been increased, increasing the chance of obtaining the cash loan in the desired amount.

Credit credibility

Credit credibility

No loan, including cash, may be granted to a customer who has had significant delays in repaying previous commitments and not to pay them and turned out to be an unreliable debtor. The bank can easily check this in the databases of the Credit Information Bureau. Credit checker submits a report along with point analysis, so-called scoring about a person. If the entries in the BIK about the potential borrower are positive, it will speed up the granting of a cash loan. Similarly, negative entries will mean that the customer will not receive a bank loan.

Application for the basis for the credit procedure

Application for the basis for the credit procedure

The bank will not start analyzing the customer’s creditworthiness or creditworthiness at all unless it starts a formal procedure to apply for the desired cash loan. This usually involves submitting an application for a loan together with a set of documents:

  • a document confirming identity – an ID card, passport,
  • certificate of the amount of income received.

Some banks require you to submit, for example, the last PIT settlement of the client or an account statement from the last three or several months. On the basis of the loan application and customer documents, the bank performs the credit procedure and finally issues the decision to grant a cash loan or reject the application.