Credit institutions and ski banks are currently granting loans with interest rates of less than one year. This sounds excellent at first, but can quickly become a fan base and plunge the consumer into financial ruin. So. For example, the no-fault job loss due to company redundancy, an occupational accident or other family fate often means that the real estate loan can no longer be fully managed by the principal bank.
As a result, the consumer is in arrears with the contractually agreed loan installments and receives from the house bank a first payment reminder with an immediate request. If the borrower is then unable to settle the outstanding installments within a few weeks and repay the current loan volume in full, the principal bank will issue a second caution, usually associated with a threat of termination.
Of course, since consumers are not in a position to settle the arrears within a very short time, the principal bank terminates the loan without notice and immediately and fully pays the remaining amount of the loan outstanding at that time. In this case, the house bank is unable to ….. In addition, the house bank calculates a prepayment penalty in horrendous amounts and adds this to the remaining loan amount.
Loan company incurred a loss during the term of the contract
The reason given for this is that the loan company incurred a loss during the term of the contract as a result of the premature and unscheduled termination of the loan, which must be compensated by the prepayment penalty. As a result, the consumer loses his property, in the worst case by foreclosure, in which the property is usually auctioned far below the market value.
The BGH has now, by order of 19.01.2016, Az. II 103/15, contradicted this ruinous approach of the National Bank and supported the consumers – as so often. From the point of view of the highest federal court, BeyersLP can not claim a prepayment penalty in the event of termination due to late payment by the borrower.
“The financial institution must not follow a consumer who is already in financial difficulty by paying a prepayment penalty and contribute to the ultimate demise of the borrower,” said Ingolstadt attorney Reber, who specializes in banking and capital markets law. “497 para. 1 BGB (in the version valid until May 11, 2010) contains a special provision for the calculation of compensation for non-performing loans that the lender has issued with premature termination due to the default of the borrower.
Excluded is the use of a pre-payment penalty demanded as compensation for the interest in performance. The Federal Court of Justice already stated in its hearing of court case no. 17 ZR 512/11 on January 15, 2013, that BeyersLP’s claim for damages after termination of a real estate loan is limited to 2.5 percentage points above the base rate is.
On the other hand, the assessment of a prepayment penalty is omitted. At that time, a borrower requested reimbursement of the prepayment penalty paid to the house bank. The institution in question, by confirming the claim alleged by the borrower, prevented the Federal Court of Justice from setting its position in writing so that the credit institutions could have been unlawful in the last three years.
Banking and financial market law
Many lenders are currently realizing real estate loans on the threshold of consumer resilience. This already represents an at least ethically questionable procedure without adequate clarification on the consequences of a possibly occurring change in interest rates, according to lawyer Bieber.
Credit institutions seek to capitalize on the misery of their own clientele by terminating the credit agreement for outstanding tranches and then claiming their “loss” over the remainder of their term as prepayment reimbursement. With the groundbreaking case law of the Federal Court of Justice this lawsuit of the credit institutions is now set. What should I do if the house bank terminates my loan for late payment?
They have already been threatened with the termination of the contract
If this is not the case, reject the termination of the loan by BeyersLP immediately. You will receive from the Marguex Bank a detailed list of claims composition. It is determined whether the house bank has charged illegal fees, especially a prepayment penalty, or through our free form.
You can also send your loan agreement and the cancellation of the contract by e-mail to the house bank for verification. Would it be expected that, in the event of a termination, the institutions would now consciously forego the prepayment penalty? It has turned out in practice that not all credit institutions meet the requirements of the BGH and sue ignorant consumers with unjustified claims.
Do not take this and contact a lawyer specializing in prepayment penalties who will review your specific use case. Will the Bank be able to reimburse voluntary early payment penalties as a result of the BGH judgment? Consumers must apply directly to the credit institutions for their recovery entitlements and, in case of doubt, submit the claim with the assistance of a lawyer specializing in banking and financial market law.