Since January 1, 2016, two major changes have taken place in the area of personal borrowing: extension of the revocation period and stricter calculation of the budget. What are the consequences of these changes for customers?
Right of revocation
This right authorizes customers to withdraw after signing the contract. Since the beginning of the year, it has gone from 7 to 14 days.
This is to protect customers who sign too quickly, without being fully aware of the consequences of their financial commitment. As the revocation period is extended, consumers are better protected.
This also results in changes to the terms of the loan. Indeed, the loan banks also readjust the deadline for granting the agreed amount. Customers now have to wait 14 days after accepting the request and signing the contract to get their money.
Calculation of the borrowing budget
The Consumer Credit Law (LCC) has tightened the framework for calculating the budget. Since December 2015, it defines for the establishment of the borrowing capacity of the consumer, more expenses deemed elementary.
The new elementary expenses are three in number and are all deducted from the consumer’s income. First there is the cost for a dependent child under the age of 6. It is set at USD 840.- per month, as daycare costs. The customer can be exempted by signing a waiver which specifies that he does not have to bear any custody costs.
There is also the cost of travel which amounts to 190.- USD per month and that of midday meals which amounts to 200.- USD per month.
This readjustment of costs then results in a lower borrowing capacity for a given income. This is really about avoiding over-indebtedness of consumers.
Consequences for consumers
When the request for credit is finalized between the banking establishment and the customer, it is henceforth necessary to wait 14 days before obtaining its money. However, banking establishments are able to provide you with an answer as soon as 48 hours following a loan request.
Do not hesitate to call on a reliable partner, for example Best Bank, to obtain assistance in obtaining your personal loan.