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The new law on restricting credit loan shark, but has its faults

Government Legislative Council has this week to discuss a new law on consumer credit. It is on one side of the stern provider and has the largest eradicate abuses, on the other hand, contains some ambiguities and contradictions with the European directive, which carried into Czech law.

Restrictions on moneylenders so that loans could no longer give everyone a thorough supervision of banks and credit companies are the most important changes in the new law on credit for consumers who have this week to discuss the Government Legislative Council. "With the European directives to protect consumers not only apply on consumer loans as before, but also on mortgages, "says Milos Borovicka legal adviser Dtest, adding:" The distinction between what and how they deal with the Consumer Credit Directive and that the directive on consumer mortgages, but it makes the bill a little problem, and it would be a problem for consumers. "

The proposal erroneously included in the loan agreement for the reconstruction of properties that are not secured by real estate. While European legislation such agreement among the classic consumer loans, Czech bill makes it to consumers less protected home loan. "The key difference is in the possibility of early repayment and withdrawal from contracts," said Juniper and explains: "While the classic consumer credit You can always repay prematurely with no more than 1% fee for a home loan can be paid annually or 20% of the entire amount owed ​​in the event of a serious life situation, or at the end of fixation. Negotiate a fixed rate for the entire duration of the contractual relationship is not unusual, but the consumer would lose the option of early repayment. "For housing loans is also subject to a fee for early repayment. If the proposal passed with such wording, the Czech Republic would violate European law and threatened she would thus higher penalties for poor performance guidelines.

Further interpretation and practical difficulties may cause the actual definition of the scope of the law, because it can be interpreted as that applied to all deferred payments such as paying a flat rate for mobile phones. No problem is not determining what belongs and does not belong to an annual percentage rate (APR), an important indicator which can evaluate the advantages and disadvantages of loans. We can only believe that the Government Legislative Council where later, deputies and senators proposal adjusted to protect consumers and correspond to European standards.
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Source: tz

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