Right of withdrawal for defective loan contracts expires – loans, home ownership

Banks and savings banks often have to reimburse not only interest but even additional money. But now there is a hurry. The right of withdrawal for incorrectly concluded loan contracts should expire soon. Legislative changes such as the planned reform of the right of withdrawal can have fatal consequences for consumers

New law on the right of withdrawal planned

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The Federal Cabinet recently passed a bill that will very likely also become law in the end. Thereafter, the right of withdrawal from 2002 to 2010 real estate loan contracts with incorrect instruction should expire on June 21, 2016. So far, the right of withdrawal of credit customers has been unlimited.

 

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Real estate loan contracts that have been concluded since October 2002 and in which the revocation instructions are incorrect are affected. This is the case for around 80 percent of the contracts. For the banking industry, it is about a volume of around 1.6 trillion dollars. Withdrawing such contracts brings a lot of money to bank customers. Borrowers can expect a reimbursement of many thousands of dollars in individual cases, not least because interest rates have fallen sharply since then.

Five steps for those affected to successfully withdraw their credit

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Stiftung Warentest recommends those affected to take the following five steps:

  1. Find your contract documents. Have the Hamburg Consumer Center or a lawyer experienced in cases of cancellation review the cancellation policy. A list of consumer-friendly judgments and comparisons sorted by banks and contract data and another list of the Hamburg Consumer Advice Center with the results of the examination of almost 2,000 credit contracts gives you an impression of which contracts contained incorrect cancellation information.
  2. In the event of a successful cancellation, you will of course have to repay your loan. Therefore, check whether and how much money you need to pay out to your bank or savings bank after the revocation. If you need a follow-up loan, get specific offers from various institutes. They don’t necessarily have to be legally binding. If you answer all questions correctly, non-binding offers are also reliable.
  3. Contracts that have already been processed can also be revoked. This means you can revoke your loan contract even if it has already been paid off or paid off. In such cases, the contract must be reversed. If you have paid prepayment penalty, the bank or savings bank must reimburse it to you. This also applies to the profits she made from your money.
  4. Detailed and continuously updated information, tips and sample texts for revocation and an Excel worksheet to estimate the consequences of withdrawal can be found in a foundation-wait test special versions of expensive credit agreements. Attention: Your declaration of cancellation must reach your bank or savings bank by Tuesday, June 21, 2016 at the latest. The deadline will have expired on June 22, 2016 at 0 am when the regulation proposed by the federal government becomes law and this comes into force as planned.
  5. In order to enforce the right of withdrawal, you will probably need to turn on a lawyer and often attract enough in court. You don’t have to decide that yet. Jurisprudence is currently developing in a consumer-friendly manner. The first decisions of the Federal Court of Justice are pending. A list of consumer-friendly judgments and comparisons already contains over 1000 entries. Once you have canceled your contract, you can wait and see what happens.

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