Credit and Loan Frequently Asked questions
When you are applying for credit or for a loan you may have a variety of questions. Here is a list of the most commonly asked questions and the answers to them.
1.My son wants me to go guarantor for his car loan. I am struggling financially, but he assured me that the dealer would not offer the loan if he believed my son would not be able to repay the loan?
You should be wary in this situation. Be aware that you will have to pay off the loan if you son is not able to. Furthermore, you will share the responsibility of credit ratings.
2.What is the Consumer Credit Code and how does it protect me?
When credit is offered the legislation under the consumer code outlines what is enforceable under certain circumstances where credit is offered. No matter where you are borrowing from they will have to outline what you responsibilities are under the consumer credit code.
3.My uncle loaned me money to be repaid over five years. Since he is charging me interest, I assume it is covered by the Consumer Credit Code?
No, it isn’t as it is a personal loan.
4.My bank account went into debit ‚ is that credit under the Consumer Credit Code?
No, this situation is excluded from the code.
5.Can I pull out of my obligation to be a guarantor?
In some cases you will be able to pull out of your obligation as guarantor. You will be able to do this before the settlement of the loan and sometimes during the loan if circumstances have changed.
6.Can the interest rate in my credit contract be changed?
If the contact states that the interest rate can be changed then it can be. However, you should get legal advice if it is changed as it can only be changed in certain circumstances.
7.We were not really honest in our credit application, and the credit company found this out, but they have not given us the notice under the Consumer Credit Code to repay the loan. Is that right?
This means that you are acting fraudulently and they can take action against you.
8.I bought a car on credit, regulated by the Consumer Credit Code. I lost my job and can’t keep up the payments. Should I do anything before they repossess?
If you r car is going to be repossessed then you should do a few things before hand. Firstly, you should take pictures of the car so you know what type of condition it is in. Then you should get the car valued. The provider will get a valuation also but this will ensure that you are getting a fair price.
9.My son entered into a contract regulated by the Consumer Credit Code, but I think he was conned into it and had little idea of what was going on. What can he do?
He should contact a legal representative immediately. In some places you will be able to talk to a legal representative for free. However, if you have been misled into a contract then you may be able to get out of your obligations.
10. How carefully should I read the credit contract before I sign it?
You should always read the contact very carefully as it outline what is required of you. If you don’t understand anything in the contact then you should get a layer to look over the specifics.
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