The European internal market has grown together in many ways in recent years.
In future, cross-border credit traffic should no longer be a problem. For example, German consumers should be able to take out loans in Spain or Finland under significantly simplified conditions.
According to the Confederation of Consumer Organizations, a new directive will in the future allow it to overcome legal differences between EU countries by filling in a single form and consumer loans ranging from $ 200 to $ 75,000 take. Borrowers are entitled to a 14-day right of withdrawal, as is generally the case in Germany.
According to estimates by intermediaries and consumer insurers, foreign credit can certainly be worthwhile: interest rates on loans not secured by mortgages last year varied between six per cent in the most favorable EU state, Portugal, and twelve Percent in the most expensive member country Finland. Germany moved with an average borrowing rate of eight percent in midfield.
Experts doubt, however, that the price situation for German borrowers will actually change.
Many foreign banks are already operating with branches in the Federal Republic. In addition, competition on the German market for consumer credit has traditionally been very intense, which means that borrowing rates are moving at a relatively favorable level.
So far, it has not been conclusively clarified how the foreign banks, if they have business with German citizens, will assess their creditworthiness. This is of central importance in the calculation of the borrowing rate. Credit experts assume that foreign banks will also be able to access the data of German credit bureaus in the future, although the legal framework in this regard has not yet been clarified. The procedure for payment defaults is also not foreseeable a cooperation of the foreign banks with local collection agencies appears as the most plausible solution.
Real estate financing is entirely excluded from the new directive. For the time being, the market for mortgage-backed loans in the Federal Republic will not change structurally. In view of the housing bubble that has also burst in some European countries, experts see no disadvantage here.
What the new foreign loans actually bring to the German consumer is as uncertain as the time when the first loans are actually granted.