The conditions to obtain a consumer loan will no longer be so difficult to comprehend for bank clients, once the National Bank adopts the provisions of the new EU directive.
The EU directive is intended to help harmonise regulations in the member countries to create a uniform market The customer will have to receive complete information on the conditions, cost and obligations that come with a loan contract before they sign it.
At the moment, most clients on the Romanian market only get to see the contract in its entirety when they sign it, as the documents are not available for informative purposes.
NBR asked the banks to provide their input on the new Directive, so that provisions could be included in the Law on consumer loan contracts, which was implemented in 2004.
The main goal of this Directive is to protect clients from misleading or incorrect practices from the banks. The application of its stipulations will lead to as high a transparency and compatibility as possible in terms of the banks'' lending offers. The relevant computational example will be the main element in an offer.
In case the interest rate suffers a significant change, the client will have to be notified immediately after the date when this happens, on paper or other durable support, with the notification including the modification to the sum they have to pay. At the same time, the Directive proposes a mathematical formula it recommends for a uniform computation of the interest rate on the community''s banking market.
In case the bank offers a lower rate of interest for a limited period at the start of the loan contract, the advertising for this loan shall include the annual rate calculated for the entire duration of the contract. The client will have 14 calendar days to withdraw from the contract, without having to provide any reason whatsoever. The period may start on the day the contract is signed or on the date when the client receives the contractual terms, as well as the conditions and relevant information stipulated in the Directive. Obviously, the client has to notify of the bank of their decision.
The Directive considers that this will allow the client more time to better understand the terms of the loan and even find an alternative offer.
Costs for an insurance policy will have to be included in the computation of the annual interest rate only if the insurance is a mandatory requirement to get the credit or the interest rate stipulated in the offer, and if the insurance contract is signed with or through the entity that grants the loan.
When buying insurance is mandatory, but its cost cannot be determined in advance, the bank is required to mention clearly, concisely and visibly the additional cost element. The Directive will not apply to such loans that exceed 50,000 euros or those secured with mortgages or loans that are currently in progress. razvan.voican@zf.ro
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