August 1, 2019

No Longer Borrowing Infinite Money With Revolving Credit

Credit providers have set a maximum for the time that you can withdraw money with a revolving credit. So you can no longer borrow ‘infinite’ money.

 

Extra spending room with a revolving credit

Extra spending room with a revolving credit

With a revolving credit you can borrow money during the term and repay it whenever it suits you. Handy, because that way you have extra spending space. However, there is also a risk here. Because you can withdraw a repaid amount, it requires self-discipline to become completely debt-free.

 

No more withdrawing ‘infinite’ money

Credit providers have now set a maximum for the time that you can withdraw money with a revolving credit. Among others, SEDAM, Finders and Sampaguita Credit have limited the withdrawal option of their revolving loans to 12 or 36 months.

You can therefore no longer withdraw money ‘infinitely’ with a revolving credit and thus continue to borrow as much as possible.

 

Self-regulation by lenders

Self-regulation by lenders

With these new measures, the Association of Finance Companies in the Netherlands (VFN) continues with self-regulation of the industry.

A maximum duration has already been introduced for new revolving loans. For new loans, you must repay the loan amount within 15 years. Lenders must now also regularly check whether the outstanding amount still fits the client’s financial situation.

The aim is that customers can only use a revolving credit as extra spending room, so for small amounts and a short term. If you want to borrow more, a personal loan is better suited.

 

Stop revolving loans

Stop revolving loans

A number of lenders go one step further. Last year Interbank put a brake on the provision of revolving loans and will stop it completely in August 2019. Securemoney Credit also no longer offers revolving credit.

The revolving credits from Rose Bank have been under a magnifying glass for some time. For example, the Juan consumer program regularly paid attention to the high lending rates that Rose Bank sometimes charges

written by Richard Rigby - Posted in Uncategorized

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