Consumer credit concerns financial products such as personal loans, revolving credit and purchases on instalments for individuals. The legislation provides protection against excessive debts and non-transparent terms.
Types of Consumer Credit
- Personal loan - A fixed loan amount with a fixed interest rate and term
- Revolving credit - Flexible credit limit from which you can draw
- Purchase on instalments - Immediate use of a product, payment in instalments
- Hire purchase - Ownership only after the final payment
- Credit card - When payments are spread, this is considered credit
Mandatory Information from Credit Providers
Before you enter into credit, the provider must clearly communicate:
- Annual Percentage Rate of Charge (APRC)
- Total credit costs
- Monthly repayment amounts
- Duration of the agreement
- Costs for early repayment
Credit Assessment
Credit providers are required to conduct a test via the BKR to determine whether you can afford the credit. A loan that is too burdensome may not be granted.
Right of Withdrawal
You have 14 days to withdraw from consumer credit without costs. You must repay the borrowed amount immediately.
Early Repayment
Early repayment is always possible. The credit provider may charge compensation, but this is limited to the actual interest loss.
Supervision by AFM
The Authority for the Financial Markets (AFM) supervises compliance with rules by credit providers in Westland and beyond.
Frequently Asked Questions about Consumer Credit
What does the right of withdrawal entail?
For online purchases or credit, you have 14 days to cancel without reason, except in certain statutory situations.
How long is the warranty period?
Products must function for at least 2 years. Defects within 6 months are presumed to have been present at purchase.
Can I claim interest on outstanding amounts?
Yes, statutory interest (approximately 8% per year) can be claimed on unpaid debts.
What to do in case of misleading practices?
You can file a complaint with the Consumers' Association, a government authority or start a legal procedure via, for example, The Hague District Court.
What is a credit agreement?
A credit agreement specifies how you borrow money, which interest rate applies and how repayment takes place.
Frequently Asked Questions Specific to Westland
What distinguishes a personal loan from revolving credit?
A personal loan has fixed conditions regarding amount, interest and term, while revolving credit offers flexibility with a credit limit. The latter is often more expensive due to variable interest rates.
How does the 14-day cooling-off period work?
Within two weeks after signing, you can cancel free of charge. The borrowed amount must be repaid immediately. This does not apply to mortgages. Send a written cancellation to the provider.
Can a loan be refused just like that?
Yes, if the credit assessment (e.g. via BKR) shows that you cannot afford the loan, the provider may refuse. This must be properly substantiated.
What does early repayment cost?
Compensation for interest loss may be charged, but this is limited to 1% of the repaid amount (or 0.5% if the remaining term is less than 1 year).
What to check before entering into credit?
Pay attention to the APRC, total costs, monthly amounts, term and extra costs. Compare providers and request clear pre-contractual information.
What if a loan has been improperly granted?
If the credit assessment has not been properly conducted, you can file a complaint with the provider or seek help via the Juridisch Loket Westland.