Since the implementation of the EU consumer protection regulations, granting a consumer loan under a general consumer credit agreement has become a complex process. Before concluding a loan agreement with a consumer, the lender must fulfill certain precontractual information duties, such as handing out the European Standardised Information Sheet (ESIS), the Standard European Consumer Credit Information form, and more.
The purpose of the consumer loan usually determines the type of the loan (bullet loan, amortized loan or fixed installment loan), the fixed interest rate and the term of the loan. Other aspects such as the possibillty of a promotional loan, the required collateral, possible interest rate fluctuation risks, commitment fees and special repayments have to be discussed and clarified before the parties conclude the loan agreement. Borrowers often find it difficult to work through all the information and understand the legal and financial implications of taking out a loan. We will help you understand the legal intricacies of the various types of loans so that you can make an informed decision and choose the type of loan that best suits your needs. Don’t hesitate to contact us if you have any questions regarding your general consumer credit agreement.