Browse Month: March 2020

Credit bureaus as well as contractual information

Bureaus – collect and pass

Bureaus - collect and pass

Credit agencies are private commercial companies that collect and pass on information, or sell it. Your clients are companies in the private sector; primarily credit institutions, leasing companies, mail order companies, online shops and telecommunications companies. They all conclude contracts with the customer as the end user. They are either directly a loan agreement or they have the effect of a loan with a contribution in kind. The mobile operator makes an advance payment with its contract. He immediately leaves the hardware to the mobile phone user and provides access to the mobile network for the contract period of 24 months. The customer pays for this service in monthly installments for two years, i.e. afterwards. The mobile phone dealer bears the financial risk that the contract installments will be paid on time and in full.

Credit bureaus collect information about creditworthiness

Credit bureaus collect information about creditworthiness

In order to minimize, realistically assess or avoid this financial “credit default risk”, the creditworthiness of the consumer is checked. This is where the credit bureaus come into play. They collect all conceivable and accessible data about the end consumer, occasionally also about the companies themselves. A well-known and well-known credit agency is private credit checker, the protection association for general credit protection. It combines all positive and negative information into one score, the private credit checker base score. It is expressed arithmetically in percentage points. The higher the percentage, the better the creditworthiness, i.e. the creditworthiness of the person concerned.

Credit bureaus have shareholders and business partners

Credit bureaus have shareholders and business partners

The private credit checker score is used as the basis for the credit rating before the contract is concluded, to stay with the private credit checker example. This is only possible with the consent of the end user as a contractual partner. He can hardly say no, because then the sales talk would be over. For its part, the entrepreneur does not forego the possibility of inquiring as a shareholder or business partner of “his credit agency” about the creditworthiness of the contractual partner. From the information from the credit agencies, solvency and willingness to pay can be read, as well as the entire contractual spending behavior. The credit agencies have no information about the income and wealth of the citizen. Only liabilities and expenses are taken into account in the credit rating.

Publicly available as well as contractual information

Publicly available as well as contractual information

The databases of the credit bureaus are “fed” in two ways. On the one hand, the business partners have all contracts with their customers entered in the database there. On the other hand, the credit agencies collect information from public announcements from nationwide authorities and courts. The private credit checker score is calculated from this mixed situation and is updated automatically every three months.

Risk of Online Money Loan User Surveys

Nowadays, I don’t want to borrow money from you anymore. With the spread of online money loan applications, with just Good Credit capital someone can already get a loan. The process is also fairly fast. On average, it only takes one week for funds to be disbursed. In fact, not a few online loans disburse funds in a matter of hours.

If you apply for a loan at a bank

If you apply for a loan at a bank

You must complete a number of document requirements such as Good Credit, salary slip, NPWP, credit card records, to a photocopy of a passbook. Then, the process itself can take up to two weeks. As a result, more and more people are glancing at various providers of online money lending services.

But, with a number of conveniences offered by online money lending services, there is a high risk that must be borne by the borrower.

One of them is a high flower trap. In official institutions such as banks to cooperatives, the average rate of non-collateral loans starts from 1-3 percent per month. While for online money loans, the interest is around 1 percent per day or 30 percent per month. How different is the amount of interest?

The Financial Services Authority (OJK) as the official financial services industry supervisory agency sets a number of policies so that the financial technology (Good Finance) company, including online loan providers, does not act arbitrarily and remains safe. Only Good Finance that complies with OJK rules has the right to operate.

But, the name is to meet urgent needs, many people tend to be desperate to borrow at online loan providers that are not registered with OJK. In principle, the important thing is getting a loan fast. Concerning interest, even though it is large, the latter business.

Well, if that’s the case, get ready to face the consequences, which of course are uncomfortable. Those who are “frustrated” using loan services that are not on the OJK list, must be prepared to be exposed to the following risks.

Get caught up with moneylenders online

Get caught up with moneylenders online

To borrow from a bank, there are indeed many requirements that must be needed. But, these rules are not without reason. In fact, indirectly, these rules can be protection for ourselves as borrowers.

The bank needs to analyze and ascertain whether we as debtors can afford to pay or vice versa, the potential for default in the middle of the road. If it turns out we have not yet qualified as a debtor, it may indeed be very risky to borrow money with a certain nominal with the current financial condition.

Meanwhile, if you borrow Good Credit capital money as offered by many online money lending services, chances are, your loan application is liquid easily. But, if it turns out you can not pay in installments in the middle of the road, so just get ready to be burdened by the debt interest to swell.

Debt payment reports are not transparent

Debt payment reports are not transparent

If it is not thorough, it is not impossible for borrowers to be deceived by these online moneylender calculations. During the bidding process, various sweet promises were given. From low-interest offers to liquid loan guarantees within a few hours.

After the victim enters a trap, you may be asked for a nominal installment without the transparency of your debt calculations. Debtors who are “lazy” are complicated, usually unwilling to bother. They assume the important thing is to pay the installments. In fact, without realizing it, they could suffer huge losses.

Misuse of personal data

Unlike banks that guarantee the confidentiality of their customers’ data, there is no security guarantee from online loan providers that are not registered with the OJK. One of the data that is prone to be misused is an emergency contact.

Usually, this emergency contact will be “terrorized” when the debtor is in arrears. Personal data can also be sold or used for unlawful purposes.

Trapped bulging investment

Trapped bulging investment

Apart from being a moneylender, online loan services also allow customers to become investors who act as lenders. But, do not ever take the risk to be an investor in services that are not registered with the FSA.

Not only does it not make a profit, but the invested funds can also disappear without a trace. If that is the case, you cannot hold the OJK to account. Oh no!

The reasons for canceling the registered marks of each of the companies above vary. However, in general, the OJK states, with the cancellation of the registered mark, all five must stop all borrowing and borrowing activities based on information technology-based technology, resolve user rights and obligations, and are prohibited from including the OJK logo and statement registered and supervised by OJK in all its activities.

 

Prepayment penalty for late loan payment

What is prepayment penalty?

What is prepayment penalty?

If borrowers want to repay their loan unscheduled or prematurely, for example as part of a debt rescheduling, banks generally charge a prepayment penalty. This serves to compensate the bank for the loss from lost interest income. A distinction must be made between compensation for installment loans and mortgage-backed loans.

Procedure for installment loans

Procedure for installment loans

Installment loans are also known as acquisition loans, consumer loans or personal loans. Repayments are possible at any time. The consumer credit directive regulates the maximum amount of compensation. If the borrower wishes to repay part or all of the remaining debt within the last year, the compensation fee may not exceed 0.5 percent of the repayment amount. If the loan is repaid early during the remaining term, the maximum possible compensation is 1 percent. In general, the prepayment penalty may not exceed the debit interest that the borrower would normally have paid up to the end of the loan term. This is effective for all installment loans that were concluded as of June 11th, 2010. The following applies to older loans: The installment loan can be repaid with a 3-month notice period. In the event of an immediate extraordinary termination, banks may deviate from the regulations. Some financial institutions waive prepayment fees, the fees and procedural modalities are regulated in the terms and conditions.

Prepayment penalty for real estate loans

Prepayment penalty for real estate loans

Real estate, mortgage or annuity loans are characterized by a long term, high amounts and fixed interest periods for debit interest. The loss of interest income that the bank incurs in the event of early repayment of the loan is correspondingly higher. However, the calculation of the prepayment penalty for mortgage loans is not regulated as specifically as for installment loans. Borrowers should carefully check whether an unscheduled repayment or early loan repayment is worthwhile. Banks do not have to approve the repayment easily. If the property is sold, the bank is obliged to accept the repayment amount.

There is no prepayment penalty:

  • after 10 years of credit and 6 months’ notice
  • at the end of the first fixed interest rate with a term of less than 10 years and one month’s notice
  • in the case of variable interest rates with a 3-month notice period
  • for fixed-rate loans with an exit option
  • for contractually agreed special repayments

Calculation of prepayment penalty

Calculation of prepayment penalty

Lenders can calculate the loss of interest that arises because a replacement transaction can only be concluded on lower terms, in two ways. The “active-active method” refers to the new loan, the “active-passive method” to an alternative investment of the repayment amount in mortgage Pfandbriefe. The calculation methods are complicated, consumers should have the prepayment penalty given checked.