On January 1, 2016, amendments to Section 8 of the Consumer Rights Protection Law came into force, which restrict the rights of non-bank creditors to unfair commercial practices. What exactly does it mean, what are the changes and how do they affect borrowers? Now it is even safer and more profitable to borrow. Find out what are the maximum interest rates on loans and other restrictions. An assessment at http://www.barsugliafarms.com/100-online-payday-loans-direct-lenders-payday-companies-direct-lenders/
Disproportionate interest payments are no longer possible under the law, as the law currently requires that the cost of a consumer credit agreement be reasonable and in line with honest business practices. Article 8, paragraph 2.3, of the Act clearly defines the maximum interest rates that are deemed to be reasonable for the purposes of this Act, respectively, from the 1st to the 7th day of credit utilization, the interest rate should not be higher than 0.55% per day The interest rate for the day should not exceed 0.25% per day and from day 15 the interest rate should be 0.2% per day. Specifically, if you borrow $ 100.00 with a repayment term of 30 days, the total amount that you give back should not exceed $ 108.80. Looking at the loan calculator, we can see that lenders are sticking to these terms, Credither has even set a significantly lower interest rate than the maximum statutory.
Apply to loans
However, it should be noted that interest rate regulation does not apply to loans secured by collateral such as a car. If the borrower has used a thing to secure the loan and the borrower’s liability is limited to that thing, the interest rates on the loans are not regulated by law. In other words, if the only thing you risk borrowing is a specific mortgaged property, the loan repayment rate may also be higher than the statutory one.
The law also stipulates that for loans with a repayment term not exceeding 3 months, all payments related to the performance of the credit agreement shall not exceed the amount of the loan granted. But these amendments to the law do not apply to secured loans or lines of credit either.
Loan using remote
Loans using remote means of communication (eg SMS, email, telephone) are repayable in installments in proportion to the term of the contract with a single payment (which includes both principal and interest payments) at least once a month. Exceptions are loans granted for a period of less than one month, credit lines, and a credit agreement which provides for the possibility of claiming default interest. However, it should be borne in mind that, as a rule, default interest should not exceed 36 percentage points above the annual borrowing rate.
The law also regulates the probable time of credit. While previously it was possible for some lenders to get a loan at any time of the day, now unfortunately it will no longer be possible. In order to protect frivolous borrowers, Section 8 (2.1) of the Act provides: states that it is forbidden to conclude credit agreements between 23:00 and 7:00, thus allowing the potential borrower to “sleep on this” and, if the borrowing is still necessary in the morning, go to the lender and conclude the transaction. So to speak – morning is wiser than evening.
With these changes in the law, the state protects frivolous borrowers by prohibiting the use of bills of exchange or the repayment of one loan with another.
Although Article 8 (4.1) of the same law and 4.2. of this article states that it is the lender’s responsibility to verify the borrower’s ability to repay the loan, we will be responsible and consider our ability to repay the loan!