Wednesday, June 3, 2020

Abusive Lending Contract Clauses

Lending is the engine of the current socio-political system, so abusive clauses in credit agreements jeopardize the stability of the system, especially since the forced executions of debt collectors are based on these abusive clauses banks.

Society works through credit and debt, which is why the activity of banks and NFIs, which use abusive clauses, is a criminal one for the future of capitalism.

Banks and NFIs took advantage of their status, forcing customers to sign contracts. Their policy, throughout the years 2005 - 2016, was simple and dictatorial:

You receive the money if you sign the contract, ready written and prepared by us. You do NOT sign the contract, as it has been written and used in thousands of cases, you do not receive the money from us.

In these conditions, there were and there are situations in which the credit officers did not know and did not understand the abusive clauses in the credit agreements.

You had no one to ask and nothing to ask, because there is no real discussion about what can happen in case of an impossibility to repay the loan.

What is worse is the lack of financial education that the Bank or the IFN had to provide to the borrower in the case of those loans for acquisitions.

Like the icing on the cake, the forced executions of debt collectors, buy receivables / loans with 3% of the value. Start on the basis and under these abusive clauses of banks.

Types of abusive clauses in credit agreements, used in forced executions of debt collectors

Regarding the abusive clauses in credit agreements, the most common are the following:

- The clause by which the creditor assumes the right to assign the receivable or the credit to any entity he wishes, ie also to the debt collectors.
- The risk commission, especially in the conditions in which an insurance was concluded;
- Management fee;
- Early repayment fee;
- Commission for file analysis or granting credit;
- The clause by which the creditor assumes the right to a variable contractual interest;
- Early maturity clause;
- The foreign exchange risk clause, regarding the CHF, Euro, Dollar currencies, through which the credit does not assume any risk from the fluctuation;
- The clause by which the creditor can access the penalizing interest, excessive or variable.

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