With the prospect of limiting the abuse of credit institutions and protecting applicants, the legislation has taken the lead and established various laws governing relations between the two parties. However, when it comes to the repurchase of a loan depending on the Consumer Code, there are specific laws allowing each party to be aware of its rights and obligations.
The law governing the various costs and commissions at the expense of the consumer
Having come into being in 2009, the Murcef law takes measures with the aim of bringing more transparency and clarity into the relationship between the applicant and the lender. In this case, by this law, the financial institution must highlight the various fees that the applicant must pay throughout the contract.
Apart from that, Murcef law also protects the borrower from any abuse undertaken by brokers or intermediaries with regard to the collection of a sum of money before the official signing of their financing offer. However, it does not affect the rate of credit repurchase practiced.
The right of borrowers to information
Making a decision on a credit buy-back is not done in a rush, you must be in possession of important information to make the right choice. In this perspective, the Scrivner law protects the applicant by obliging the lender to provide his customer with the necessary information directly related to the repurchase of credit so that the latter can make informed decisions. All the data allowing to clarify the advertising on the credit, the regulation on the offer and the period of reflection must be delivered to the applicant.
The law in case of over-indebtedness
In the event of over-indebtedness in repurchase of credit, the Neiertz law treats the various prevention and its management. By the existence of the debt commission, borrowers will be able to benefit from assistance when he is in a difficult situation in financial matters.
However, this law requires lenders to carry out their investigations to find out the creditworthiness of their client before granting them a loan repurchase. Aside from that, this law offers an advantage to applicants in modulating the loan repayment duration.
Christine Lagarde law
For better supervision of banking establishments and consumer protection, the Lagarde law was created in 2010. First of all, the new subscribed offer must include all the different costs in the event of early repayment.
Then, the law obliges the lender to specify to applicants the total cost of the consolidation. To allow the consumer to be aware of his obligation, each offer must contain the statement “a credit commits you and must be repaid”. Finally, in terms of advertising, all types of costs must also be very specific.