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MIL OSI Translation. Region: Russian Federation –

Source: Central Bank of Russia – Central Bank of Russia –

The Bank of Russia has revealed that some lenders are trying to attract clients by offering to change the terms of the credit or loan agreement for a fee and thereby creating the appearance of improving conditions. The regulator believes that such practices are unacceptable and increase the risk of misleading the borrower: it is difficult for a person to understand and objectively evaluate the proposals on which changes in the amount of his expenses depend.

For example, a future borrower is offered to receive a loan or a loan at a reduced rate for an additional fee. This effectively means paying interest upfront. Another paid option allows you to reduce the size or select a different date for making the periodic payment in case the borrower’s salary suddenly decreases and the schedule for receiving it changes. If this does not happen, the consumer will waste money on a service that he does not need. For an additional amount, lenders offer to reduce the 30-day notice period for early repayment of the loan, but if the citizen ultimately does not pay the creditor ahead of schedule, he will also waste his money.

Paid options include debt restructuring, the ability to skip the next payment, and return part of the interest after repaying the debt. A number of lenders even sell consumers their waiver of collection of debt should it arise. However, such debt will still be reflected in the borrower’s credit history.

The Bank of Russia sent a letter to lenders with recommendations to refrain from using such practices, since they create conditions for violating the rights of the borrower.

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Note; This information is raw content directly from the source of the information. This is exactly what the source states and does not reflect the position of MIL-OSI or its clients.

Please note; This information is raw content directly from the information source. It is accurate to what the source is stating and does not reflect the position of MIL-OSI or its clients.

EDITOR’S NOTE: This article is a translation. Apologies should the grammar and or sentence structure not be perfect.

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