Taking out a loan is always associated with costs. These are the payment by the bank for the provision of the loan amount and the associated expenses. They are calculated in the form of interest on the loan amount. In addition, many prospective creditors are wondering whether additional loan processing fees are allowed. We will answer this question for you in this article.
What does a loan cost?
The lending bank incurs various costs when issuing an installment loan. Above all for preparatory activities, such as checking the creditworthiness or processing the loan application, the bank already does a certain amount of work in advance of the conclusion of the business. This also includes:
- Loan processing fees.
- Loan fees.
- Processing fees.
- Closing or processing commissions.
Nowadays, all costs incurred by the lender are included in the interest payable, the so-called effective interest rate.
What are the fees for a loan?
Processing fees that depend on the loan amount and are billed in advance of borrowing are nowadays not permitted. According to a judgment of the Federal Court of Justice (BGH), no additional fees may be charged for preparatory activities for taking out a loan. All costs incurred for the contract may therefore only be covered by the interest on the loan.
Can fees already paid be returned?
In May 2014, the BGH ruled in two judgments (XI ZR 170/13 and XI ZR 405/12) that credit agreements that contain clauses on additional fees are not permitted. Customers who have already paid such processing fees often have the option to request them back. The only requirement for reimbursement of the fees already paid is that these claims have not yet expired (more on the cancellation joker). No processing fees may be charged by the borrower for future loan contracts. The reason of the BGH is that the processing of the loan is not an additional service.
All processing steps for accepting a loan are activities that are carried out in the interest of the lender in the sense of the conclusion of the contract. For this reason, the borrower does not have to pay them separately. Therefore, only the interest rate agreed for the loan has to be paid by the customer in the course of the monthly repayment installment.
Which loans are affected?
The BGH judgments mentioned regarding the inadmissibility of processing fees for loans refer only to consumer loans. A prerequisite for consumer credit is that it has been taken out by a private individual. These include, for example:
- A loan for new furniture or a new kitchen.
- A loan for a new car or motorcycle.
- Financing real estate.
- The consolidation or rescheduling of several loans.
- A credit for dentures.
- A credit for a vacation.
Even processing fees that are estimated by the bank as part of a special repayment are not permitted. However, the BGH also ruled in 2017 that additional processing fees are not permitted for commercial loans. The question of whether loans for business start-ups are also affected by this regulation has not yet been clarified. It is only clear as long as the loan amount is below $ 75,000, no processing fees may be charged for start-up loans.
How does the refund of the fees paid work?
If you have already paid impermissible processing fees, you can request them back. The prerequisite for this is that you comply with the relevant limitation periods in order to assert your claim for reimbursement. The following overview shows you which deadlines apply:
|Year the loan was taken out||Can I get a refund?||statute of limitations|
|2004 to 2011||Yes||ten years|
|From 2012||Yes||3 years|
Processing fees already paid for a loan contract concluded in 2010 can therefore be claimed back until 2020. However, claims for reimbursement of processing fees for a loan taken out in 2012 could only be asserted until 2015.
How to proceed for reimbursement
In order to maintain the right to reimbursement of improperly paid processing fees, you should write to your bank in good time before the end of the year in which your limitation period ends. You can use a prepared sample letter for this. The best way to do this is as follows:
- Write to your bank within the limitation period asking for a refund of the inadmissible processing fees.
- Set a period of 2-3 weeks for the bank and send the cover letter by registered mail. In this way you can prove receipt of the letter in case of doubt.
- In addition to the processing fees, you can also request interest on these.
- If the bank does not respond within the set period, you can send a reminder to the bank or hand it over to your lawyer. Alternatively, you can also contact an ombudsman.
Conclusion on the admissibility of processing fees for loans
Additional processing fees charged by the bank for a loan are not permitted. Fees already paid can also be reclaimed within the limitation period. When taking out a new loan, you should make sure that the respective bank does not charge any additional fees. If it does, it is an untrustworthy company and it is better not to do business with it. It is best to use our loan comparison from Kreditexperte.de right away. You will only find trustworthy partner banks here. The loan request at Kreditexperte.de is also completely free.