Since September 1, 2018 – after a few years of investigation – new and stricter rules for fast loans apply. The purpose is to protect yourself as a borrower. This applies both to protection from rogue actors and from – yourself! You and your bad judgment (Nothing personal).

With the new law, a high-cost credit may not have an annual interest rate that exceeds 40% plus the reference rate. If the reference rate is 0.5% (as it is at the time of writing), this means that a sms loan must not have an interest rate higher than 39.5%.

The total cost including fees and reminders may not exceed 100% of the loan amount.

Extensions that were previously a major problem are minimized so that only one extension is allowed.

 

Warning triangle requirements since July 1, 2018.

After July 1, 2019, high-cost credits are required to be marked with a warning triangle. It should be stated that the loan is a high cost credit and a clear text that failure to pay can lead to negative consequences in the form of a payment note and information on how to contact

 

Other requirements on the lender

Total cost must be stated

Total cost must be stated

Now we come to the requirements that are placed on the lender. It can be difficult to calculate in advance what different loans will actually cost. There are so many moving parts. The interest rate is understood, but also different types of fixed and variable fees. The fact that the loans have such different maturities also complicates the comparison. For example, it may very well happen that a loan with a lower interest rate becomes more expensive than a loan with a higher interest rate but a lower set-up fee, if it is a short-term loan. And quick loans are often short-term. Therefore, it has been decided that all “loan products” must have a clearly stated total cost.

 

Effective interest rates must be evident

Effective interest rates must be evident

Different loans have different interest rates, but they also have different fees, and they have different maturities. All of these details affect the cost of the loan, which we described above. Effective interest rates mean that all costs are converted to an annual interest rate. In addition to the total cost, it has also been decided that all “loan products” must have a clearly stated effective interest rate, in order to make them easier to compare. Effective interest rates are smart, but you can read more about this.

 

Serious credit check a requirement

Serious credit check a requirement

The law imposes requirements on the company that issues the loan and requires them to do a serious check on the borrower’s credit before the loan is granted, a credit check or credit check. If it turns out that a loan company is neglecting the credit tests, it can be punished with a penalty or suspension. So don’t take credit for the credit check, it’s nothing personal.

 

A two-week right of withdrawal also applies to loans

A two-week right of withdrawal also applies to loans

When you shop online, you have two weeks’ right of withdrawal, and now the same applies when you “buy” loans. A loan can be seen as a product among others. You pay for it and now you can even regret that you bought it. Note, however, that you will not get back the costs you have had for the loan so far, such as accrued interest.

 

Clear documentation

loan condition

When you take out a quick loan, the lender must provide you with clear documentation of the loan. It is thus an agreement in which all the details of the loan and the terms of the loan are disclosed. You usually get it in the form of an e-mail or a PDF that you can download or print.

 

Terms of Refund

loan payment

The documentation of your loan agreement must also state how you will repay the loan, for example a certain repayment per month, or a fixed amount per month divided between an increasingly large repayment portion and an ever smaller interest portion (annuity). It should also be shown how to do an extra installment or even pay off the entire loan in one swipe.

 

Reminders, debt collection, Chronicle

debt loan

Your loan agreement must state what applies if you neglect the repayments. The lender has the right to send reminders and impose certain reminder fees and penalty interest. They can pass on missing payments to debt collection. Following repeated negligence on the part of the borrower, the agreement may give the lender the right to decide on early termination of the agreement, which means that they will collect all the remaining debt on a board. The lender may also decide to report your debt to Kronofogden for assistance with the recovery.