Changes to credit agreements
Subsequent changes to credit agreements may cost consumers dearly. For rate changes, suspension of redemption, or a change in the installment date, fees may be in the three-digit range. Consumers often overlook costs because they do not appear in the effective interest rate.
Effective interest rate
The effective interest rate indicates the financing costs incurred in the case of scheduled repayments. He says nothing about how deep borrowers can get into the pocket after making a payment. The cost of a single change will vary between 0 and 50 usd, depending on the bank.
Particularly annoying are later additional costs, if they result from a supposedly small change of the contract. For example, up to 40 usd may be charged if the monthly installment is not debited on the 01st but on the 15th of the month at the request of the borrower. Some banks require lump sums for such processing, which are often unknown to borrowers.
Costs of special repayment
The costs of special repayment should also be considered by consumers when making credit comparisons. The upper limit of fees for lawmakers (1 per cent of the settlement balance) has not yet been applied to many banks because, in addition to the indemnification fee, additional (or differently named) fees are charged. The comparison is also worthwhile here: For many banks special payments are possible at any time free of charge.
Expensive can also be a subsequent rate change.
It does not matter if the monthly rate is raised or lowered. While some banks do not charge fees for a rate change, others take 5 to 50 usd. Note: If the rate is changed several times (for example, by temporarily reducing it and then raising it again), the fee will increase twice.
Consumers should consider additional costs and costs for subsequent changes already in the credit comparison. As far as fees are concerned, they should be as low as possible and be understood as a real compensation rather than a source of revenue for the bank.
Some banks generally charge fees for certain services, but provide a free quota. For example, borrowers can suspend installment payments twice a year or make a special payment once a year for free.