Credit broker

Credit intermediation ( brokerage or loan ) is the commercial negotiation of credit to (future) borrowers. Credit intermediation is subject to legal regulations in many countries, especially if the borrower is a consumer.

• 2.1 Legal basis
• 2.2 brokering
• 2.3 Vermittlungsprovision
• 2.4 history

General

Credit intermediaries

Credit intermediation is performed by credit intermediaries. This, in addition to the authorization as a credit intermediary pursuant to § 34 c GewO also have a registration as a broker or insurance agent. Breakdown of employees of banks or other financial intermediaries act as an agent of their employer. This in turn requires itself a separate license according to § 34 c Industrial Code.

There are also specialized in Internet platforms for credit provision. These store the terms of the member banks (especially of direct banks ) for standard loans. The customer receives a condition overview of the possible for him loan offers and can opt for a provider of their choice.

A third field of credit intermediaries is the so-called "social lending" dar. Specialized vendors try to bring together investors money and credit seekers without the involvement of a bank. Here, however, the problem is that often lack the possibility exists for the individual investor to obtain comprehensive information on the solvency of the credit seekers. Main article: Peer-to -peer lending.

Authorisation as a credit intermediary is regulated by law in various countries. Prerequisites for admission may by certificates of competence to be the existence of liability insurance, the existing impunity or membership in associations.

Credit agency contract

The loan brokerage agreement (or loan brokerage contract ) regulates the rights and obligations of credit intermediaries and customers. Areas of regulation may, inter alia, be:

• Definition of the intermediary loan
• Regulation of the commission claims of the intermediary
• Temporary nature and exclusivity of the mediator
• Other regulations, such as privacy, etc.

In many countries exist with regard to the credit agency contract formalities, regulations on minimum content and limits of freedom of contract by statutory requirements.

Kreditvermittlungprovison

The Kreditvermittlungprovison (or Darlehensvermittlungprovison ) represents the remuneration of the intermediary for its mediation services dar. payment Commits may be the lender and / or the borrower. The commission is typically paid as a single payment transaction when the credit. Even a pro rata payment of the commission during the repayment period is possible, but very uncommon. If in the country legally permissible, even successful independent brokerage commissions can be arranged. In many countries, however, this is prohibited by law.

EU Directive

The European Union has regulated the legal framework for loan agencies to consumers in the Consumer Credit Directive 2008/48/EC of 23 April 2008.

Credit intermediation in Germany

Legal bases

First, the activity needs as credit intermediaries to approval by the competent authority (usually Gewerbeaufsichtsamt ) according to § 34c para 1 No. 1 Industrial Code. A permit shall be granted only if the applicant has the required for a commercial operation of this type of reliability and can show parent 's financial circumstances ( § 34c para 2 Industrial Code ). Commercial means that a credit intermediary must demonstrate a type and extent commercially organized business operation for a permanent activity for profit.

To apply for credit intermediaries, the statutory provisions for brokers and some special provisions. The credit intermediary may in accordance with § 655a BGB only give a consumer a consumer loan contract for payment when the contract is drawn up in writing and the entire compensation is a percentage of the loan amount ( § 655b BGB). The consumer shall pay the compensation to the credit intermediaries have no obligation if the loan had been paid ( § 655c BGB) and a revocation by the consumer ( § 495 BGB) is no longer possible. Other charges, except for the expenses actually incurred, shall not be required ( § 655d BGB). After that are a flat rate calculated expenses, without having been detected in individuals inadmissible. In addition, the mediator shall comply with the 13 draft Law referred to in Article 247 § pre-contractual information. A loan brokerage agreement which meets the requirements - in particular the requirement of writing - not enough is void ( § 655b para 2 BGB). This provision restricts the general rules on the reimbursement of expenses of brokers according to § 652 para 2 BGB in favor of consumers. These rules are generally not dispensable; they may therefore not be waived in a particular case ( § 655E BGB). Be managed only consumers but not businesses and self-employed who want to use the loan for their business operations. A further condition is that the credit intermediary is an entrepreneur within the meaning of § 14 BGB.

Mediation activity

Vermittlungsprovision

History

First time credit intermediaries are mentioned in the Roman Empire. So used the Roman emperor Tiberius in 33 first credit intermediaries to solve a financial crisis.

By the end of 1990, the main activity of intermediaries in Germany was on providing installment loans for residential customers with poor credit ratings. This often brought the credit commission from the borrower. Only a few providers to have niches for example, commercial borrowers or developer financing tapped.

A notable exception was the distribution of mortgage lenders. These have traditionally only a small share of direct business. The greater part of the distribution with respect to the construction financing was carried out by the Group or group- commercial banks and other distribution partners that occurred with respect to the Erstrangdarlehens as credit intermediaries.

The Consumer Credit Act of 1990, concrete legal rules regarding the credit passed to consumers have been taken. These provisions in § § 15-17 VerbrKrG were transferred to the Civil Code of 2002.

With the development of the Internet as a mass medium, a new group of intermediaries that operate the " social lending " was born. Credit seekers and private lenders meet on Internet platforms such as the U.S. " Prosper " or the German " Money4Friends " because the number of frustrated bank customers grow. Some platforms have focused on the procurement of cheap loans for builders and home buyers. These dominate the current appearance of credit intermediaries. Due to the bulk purchase of loans from banks and the acquisition of customer service tasks generate these price advantages. The loan fee is paid by the bank in these new providers.

The largest credit intermediaries in Germany are Interhyp, the German Vermögensberatung AG, Dr. Klein & Co. AG, MLP AG and AWD Holding AG.

Credit brokerage in Austria

In Austria the negotiation of credit to consumers is regulated Brokers Act. After a personal loan broker who is a commercial for banks lending transactions within the meaning of § 1 para 1 3 of the Banking Act ( BWG), conveys that are not secured by mortgages. The mediation agreement shall be in writing and must contain a number of minimum information. These are the minimum disclosure requirements for consumer credit and the specification of the ( maximum) commission. The mediation agreement is limited to four weeks.

Credit intermediation in the United Kingdom

In the UK, the negotiation of credit is regulated since 1974 in the Consumer Credit Act 1974, which was revised in 2006 as the Consumer Credit Act 2006.