/ world today news/ A large part of Bulgarian banks use tricks and tricks in their relations with customers. They, in turn, rarely understand about them. Financial consultant Vasil Kendov sheds more light on the most common misconceptions about people looking for borrowed money.
1. The most common misconception is that the bank branch makes a decision and grants the loan. This is not the case. Absolutely every bank has a credit center to which customers do not have access. There, a bank employee scans your documents and makes a decision. In 99% of cases, branch employees do not know exactly who this employee is. Naturally, they can understand if they wish, but if this is their wish very often, they will have problems.
What can you do at the branch? If you come across a decent and competent employee, he can explain to you what and how to write in the documents so that you may be granted a loan. You should be sure that not all employees are equally competent. These people, in addition to loans, are supposed to sell you related products – insurance, deposits, pension insurance, mutual funds… You understand that they cannot be competent in all areas.
2. The interest rate is the last parameter you should look at when choosing a loan. Although this is the most advertised “dignity” of a loan, you should know that with the Consumer Credit Act of May 2010, banks are allowed to change your interest rate unilaterally and without warning. And they do it often enough. They even went so far as to announce interest rates for new customers (low) and for old customers (high). Simply because after 6 months you are already an old customer and you have an early repayment fee (2 years ago the EU in its directive banned penalty interest for consumer loans, but left one for mortgage and home loans. Now these fees are expected to disappear for all loans for individuals, but when… no one knows) In other words, you have no fee for early repayment of a consumer loan, but the initial fee for granting the loan has increased. At the moment, 2.5% of the loan amount is “suspiciously” the same in all banks. They reduce it only during promotions or special offers for employees of large companies.
3. The insurances offered for loans are quite limited in terms of coverage. However, in no case can we say that they are cheaper in the bank. Simply cut coverages are at the expense of the commission that the bank receives from the insurance company. Only 30% of claims are paid out. Even the first big landmark case against a bank in Bulgaria was about insurance, which the bank refused to take out, even though it advertised free insurance on TV. The bank was convicted and fined.
4. On whatever occasion you communicate with a bank, it must be in writing. You must submit your requests in writing with an incoming number. Otherwise, you’ll be amazed at how you fail to understand each other or how you get it wrong every time.
5. If your loan was withdrawn before May 2010 and you have a change in your installment on it, this means that you have the right to make claims against the bank in court. Winning the case is 100% certain. There is already enough practice in this matter.
6. Before withdrawing the loan, search the Internet for protocols from the Commission for Consumer Protection (CCP) regarding unfair clauses in the contracts of the bank you have chosen. Signing such a contract gives you the opportunity at a later stage to make claims against the bank. On the other hand, this protocol is based on a client’s report, and as soon as this conclusion of the KZP was reached, then the bank violated the contract with another client who submitted the report. Include in your expectations the possibility of such behavior towards you. However, very few people will pursue their claims this way, and the bank doesn’t mind paying for a lost case or two, when it stands to gain from thousands of other customers by breaching the contract.
7. Look for judgments in cases against the bank of your choice. Because they are quite long and complex, at the end of each decision are the reasons of the court, summarized in a few sentences. You will learn a lot about your bank from them.
8. It doesn’t matter which bank you take out the loan from. Practice shows that they either sell your loan at some stage to another company, or pledge it to another bank as collateral for another loan, or the entire bank is bought by another. If you think it is important for you to be a client of a Western institution, know that this is impossible to guarantee. In addition, we have only 3-4 branches of foreign banks in Bulgaria. Practically every big bank you know is Bulgarian and not foreign. Although the owner is a foreign financial institution, the bank is headquartered in Bulgaria and is registered under our legislation. This is due to the fact that our economy is quite risky and, if necessary, the “mother” bank can easily and quickly “get rid” of its business in Bulgaria, before the negatives are transferred to the head office.
9. In Bulgaria, you have no practical protection against bank errors or speculation. The only one you can get in court, after 2 years for the first instance and 1 year for the second, if the bank appeals. In practice, every EU member state has at least a financial ombudsman to protect the rights of borrowers. The Germans have 7 financial ombudsmen, the British, in addition to the ombudsman, also created a special agency to monitor bank abuses. In Bulgaria, apart from the court, there is no one to complain to.
10. The surest way to get what is best for you is advance information. The more you collect before applying for a loan, the less problems you will have with your credit in the future. And it is for a rather long period of time and the contract with the banking institution is quite serious. The time invested in research will pay you back a hundredfold.
Source: Rozali.com
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