A credit contract, often called a loan contract, is in most cases concluded between banks and private individuals or companies. In this case, the banks are the lenders because they provide the capital they need, and the private individuals or companies are the borrowers because they need the capital. However, loan contracts from private individuals to private individuals are also possible; these are now offered and processed via several Internet portals. All of these loan agreements are subject to certain legal requirements, which must be observed by both contracting parties.
Legal requirements / basics
Credit and loan contracts are concluded in accordance with sections 488 ff. Of the German Civil Code (BGB), i.e. in accordance with the guidelines of debt law. Debt law grants the two contracting parties, i.e. the lender and the borrower, general freedom of contract, so that the provisions regulate only a few statutory minimum requirements. According to this, a loan is a so-called contractual contract. Incidentally, the law does not refer to credit, but only loan. This contractual contract regulates the transfer of money or other transferable items into the possession or property of the borrower. In addition, the repayment obligation is agreed in this contract. Accordingly, there must be a legally effective offer from a lender or lender in accordance with these provisions and a declaration of acceptance from the borrower or borrower so that a loan contract is concluded at all. This is also called a concurrent declaration of intent. § 145 BGB.
If the contracting parties unanimously submitted this declaration of intent to conclude the loan contract, they undertake to also fulfill the contractual provisions. The lender must not, for example, pay out the loan amount until the lender has fulfilled the payment conditions agreed in the contract.
Types of loan contracts
There are different types of loan or loan contracts, but all of them must be processed in accordance with the above requirements. The different types include, for example, the overdraft facility and the overdraft facility. But also long-term and medium-term loan agreements such as real estate financing, consumer loans or an investment loan. Depending on individual needs, a borrower can select the right type of loan for them and obtain corresponding offers from the lenders.
Cost of a loan agreement
In addition to repaying the actual loan or loan amount in monthly installments, the amount of which varies depending on the loan amount and term of the loan, there are also other costs for the borrower when he takes out a loan. This is, for example, the loan interest agreed between the contracting parties, which was agreed between the contracting parties. In many cases, the conclusion of a loan agreement also incurs fees for processing the contracts in the bank, which are also part of the costs of a loan contract. These loan interest and fees are part of the actual loan agreement and must be known to both contracting parties and must also have been accepted by both parties. However, according to the current case law of many higher regional courts, it is controversial whether banks may charge so-called processing fees for the granting of loans. According to the courts, this is not allowed, but a number of banks do not abide by it. A final clarification of the situation will certainly be a while away, so that there is the possibility for borrowers to claim back the processing fees that may still be included in their loan contracts with a sample letter.
Term and collateral for loan agreements
It is common in the credit market to limit the term of loan contracts and loan contracts to a certain duration. Banks usually offer maturities of between 12 months and 84 months as standard for consumer credit. However, the length of the term should be adapted to the loan amount and the personal financial situation of the borrower. During the agreed term, for example for 48 months, the borrower must then pay the monthly installments agreed in the loan agreement. Before a loan agreement is concluded, the borrower must provide the bank with appropriate security, which proves that it can actually repay the loan amount taken out.
As a rule, the banks require proof of income from the last three months and the submission of an unlimited employment relationship. The borrower’s financial resources must therefore be disclosed for the conclusion of the contract. All information provided by the borrower regarding his personal financial situation must be truthfully provided to the lender. To secure a loan or credit contract, life insurance, home savings contracts, a vehicle or even your own home can also be used. The agreements on special collateral are not part of the loan agreement, but are usually recorded separately in the so-called security agreement.
Ineffectiveness of loan contracts
There are various reasons why loan contracts can be ineffective from the start or afterwards. This also applies if, for example, the loan amount has already been paid out. A reason for the ineffectiveness of a loan contract can be, for example, if a so-called
Usury loan contract has been concluded. This is the case if the agreed interest rate should exceed the market interest rate by relatively 100% or absolutely by 12 points. So-called over-collateralization can also lead to the ineffectiveness of a loan or loan contract. A so-called immoral loan contract or usury is no longer curable under the law and leads to the nullity of agreed collateral and loan contracts. However, if the loan amount has already been paid out, the repayment will no longer result from the ineffective loan agreement, but on the basis of the provisions of Section 812 (1) sentence 1 BGB. The so-called enrichment regulations. The borrower is therefore still legally obliged to repay the loan amount.
For many loan or loan contracts, the lender offers his contract partner, the borrower, the option of making a so-called special repayment. This is mainly the case with real estate loans. These special provisions on the so-called special repayment state that the borrower is allowed to repay a previously agreed amount in addition to the monthly loan installments at certain intervals, usually once a year. This agreement gives the borrower the opportunity to repay the loan taken out faster than if he only paid the agreed monthly installments. However, it is a prerequisite for this special repayment that the borrower has sufficient financial resources to save the amount agreed for the special repayment. However, the special repayment is not a mandatory agreement, but an agreement that the borrower cannot use.