Alongside traditional consumer credit agreements there are more specific agreements, in particular, the granting of credit in the form of overrunning.
This is a tacitly agreed overdraft by virtue of which a lender authorises the consumer to access funds in excess of the balance of their current account or an agreed overdraft facility.
Who is concerned
This concerns professional lenders as well as consumers who tacitly accept a consumer credit agreement in the form of overrunning (e.g. credit granted when a current bank account is opened).
How to proceed
Conclusion of the contract
Overrunning does not necessarily have to be agreed in writing.
Duration of the overrunning
Overrunning for more than 1 month
If the overrunning goes on for more than one month, the lender informs the consumer, without delay, on paper or on another durable medium (e.g. CD, etc.):
- of the overrunning;
- of the amount involved;
- of the borrowing rate;
- of any penalties and fees or interest applicable.
Overrunning for more than 3 months
If the overrunning continues for more than 3 months, the lender shall immediately offer the consumer another type of credit agreement to prevent the consumer from using the overrunning as a long-term form of credit due to higher interest rates and less favourable terms for the consumer.