Regulated Agreement Deutsch

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Understanding Regulated Agreement Deutsch: A Guide for Consumers

If you live in Germany and want to borrow money, you may encounter the term “regulated agreement” or “geregelte Vereinbarung” in the context of consumer credit. A regulated agreement is a type of credit contract that is subject to specific legal requirements aimed at protecting consumers from abusive practices and ensuring transparency and fairness. In this article, we will explain what regulated agreement Deutsch means, what types of credit are covered, and what rights and obligations you have as a borrower.

What is Regulated Agreement Deutsch?

A regulated agreement, in German “geregelte Vereinbarung”, is a contract between a lender and a borrower that falls under the scope of the German Civil Code (Bürgerliches Gesetzbuch or BGB), specifically the sections on consumer credit (§§ 491-510 BGB). The BGB defines a consumer as a natural person who enters into a legal transaction for purposes that are predominantly neither commercial nor self-employed. This means that if you borrow money as an individual for personal or household use, you are likely to be considered a consumer and your credit contract may be regulated.

The main purpose of regulating consumer credit is to protect consumers from unfair and deceptive practices and to promote responsible lending. Regulated agreements must comply with certain rules and principles that aim to ensure transparency, clarity, and affordability. For example, the lender must provide you with a pre-contractual information sheet that contains key information about the credit, such as the total cost, the interest rate, the repayment schedule, and the consequences of default. You have the right to receive this information free of charge before you sign the contract. Moreover, the lender must assess your creditworthiness before granting you the credit, and must not charge you excessive fees or interest rates.

What Types of Credit Are Covered?

Regulated agreements can cover various types of credit, such as:

– Consumer loans: These are loans that you use to finance a specific purchase or expense, such as a car, a home renovation, or a vacation. The loan amount, the interest rate, and the repayment terms are usually fixed.

– Revolving credit: This is a type of credit that allows you to borrow money up to a certain limit, and to repay it over time. Examples of revolving credit are credit cards and overdrafts. The interest rate may be variable, and you may incur fees for using the credit.

– Hire-purchase agreements: These are agreements in which you buy a product (such as a furniture or an electronic device) by paying instalments over a period of time. The product remains the property of the seller until you have paid the full price. The interest rate and the other costs are included in the instalments.

Regulated agreements do not cover mortgages, commercial loans, or loans to self-employed persons.

What Are Your Rights and Obligations?

As a borrower under a regulated agreement, you have certain rights and obligations that you should be aware of. Here are some of the most important ones:

– Right to information: You have the right to receive clear, comprehensive, and accurate information about the credit, including the total cost, the interest rate, the repayment schedule, and the consequences of default. You should read the pre-contractual information sheet carefully and ask the lender if you have any doubts or questions.

– Right to withdraw: After you have signed the contract, you have a 14-day cooling-off period during which you can withdraw from the credit agreement without giving any reason. You must inform the lender in writing or by email, and return any money or goods you have received. If you have used the credit, you will have to pay back the outstanding balance and any accrued interest or fees.

– Obligation to repay: You must repay the credit according to the agreed schedule, unless you have a valid reason for not doing so (such as illness, job loss, or force majeure). If you default on the repayments, the lender may charge you additional fees, report you to a credit bureau, or even take legal action against you. Therefore, it is important to budget properly and to notify the lender immediately if you foresee any difficulties in repaying the credit.

– Right to early repayment: You have the right to repay the credit fully or partially before the due date, without penalty or additional costs, unless the lender has explicitly stated otherwise in the contract. You may save money on interest by repaying the credit early, but you should check if there are any restrictions or conditions that apply to early repayment.

– Right to complain: If you believe that the lender has violated your rights or the legal requirements for regulated agreements, you can file a complaint with the lender`s customer service or with a consumer protection agency. You may also seek legal advice or representation if necessary.

In conclusion, regulated agreement Deutsch is a term that describes a type of credit contract that is subject to specific legal requirements aimed at protecting consumers. If you are planning to borrow money in Germany, it is important to understand what regulated agreements entail, what types of credit are covered, and what rights and obligations you have as a borrower. By being informed and responsible, you can make the most of consumer credit and avoid pitfalls.