Changes in loans and mortgages from 1. 12. 2016

Changes in loans and mortgages from 1. 12. 2016

Main areas of change:

1. Information for the client

The provider will be required to inform the client is always their registration at ČNB and what type of loan is entitled to mediate. The client has the right to be informed about the amount of commissions paid to intermediaries which must be included in pre-contractual information. The client has the right to be informed about the amount of commissions paid to provider which must be included in pre-contractual information. On the form of pre-contractual information, the client will be required to provide more information, including the RPSN, the "total cost of loan" and "total amount of loan", which is the sum of principal and total costs. The resolution will be whether the provider gives the client a recommendation or advice

2. Possibility to change your mind / cancel the contract

For consumer loans is still valid current rule, when a client first signs loan agreement and since it can cancel the loan without giving any reason within 14 days to signature.
For housing loan client receives a binding contract at least 14 days in advance and within this period, it can then decide whether it will sign or not sign.

3. Some important new obligations for banks 

-          verification of credibility

-          Information on the new interest rate, clients will get at least three months before the end of fixation

4. Early repayment of loans from 1. 12. 2016

Consumer loans other than housing it is possible to pay off  the loan anyway: in the case of indemnity intended to secure the loan, and in case of a variable rate.

Mortgages
In the case of sales of a financed or mortgaged property, you can repay the loan completely for the fee 1% of the loan amount, max. 50 000 CZK and after 2 years of the conclusion of the credit agreement.
Further for all mortgages from 1. 12. 2016 will be possible partially repay up to 25% of the total loan amount every year, always one month before the anniversary of the credit agreement.

Ondřej Marek