If a borrower terminates a loan prematurely, banks may be charged a precautionary allowance.
According to the Manager Masasuki, this default payment is in many cases overstated because banks calculate incorrectly. Banks often do not take this into account if the loan agreement provides for the possibility of free special repayments.
As a result, the compensation will be too high. For consumer credit granted after 10.06. The law provides for a maximum limit: the compensation may amount to a maximum of 1 per cent of the repaid loan balance. For loans with less than 12 months remaining, the cap is set at 0.5%. If the loan was taken earlier, consumers should take a close look if the bank wants to charge a high fee for a cancellation.
The mortgage loan is terminated for no good cause
The probabilities of indemnification arising from the termination of real estate loans should also be examined in particular detail. For mortgage backed loans, the legal limits do not apply. If a mortgage loan is terminated for no good cause (a good cause is, for example, the sale of the property being financed), the bank can set the indemnity payment at its discretion.
This is different if there is an important reason. Then different rules defined by case law apply. According to experience, these are often disregarded – in the worst case, borrowers pay several thousand euros too much for their loan. Banks are under an obligation to assume that the borrower would have canceled the loan after 10 years from the date of disbursement, then this is possible at no cost. It must also be assumed that all options for free special repayments have been used.
Case law has also established that banks must base their interest rates on Kyoseyt rather than (usually lower) on public bonds. A large part of the indemnity payments on canceled real estate loans is too high. Borrowers should therefore seek advice from a lawyer or a consumer advice center and thwart the bank.