LAW OF OBLIGATION ACT, PART 3, CHAPTER 22, DIVISION 2

Division 2

Consumer Credit Contract and Contracts Linked Thereto 

  • 402. Definition of consumer credit contract and consumer credit contract relating to residential immovable property

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(1) A consumer credit contract is a credit contract by which a creditor, in the course of the economic or professional activities thereof, grants or undertakes to grant credit or a loan to a consumer.

(2) A consumer credit contracts relating to residential immovable property is a consumer credit contract which is secured by a mortgage or another comparable security, or a consumer credit contract which objective is the acquirement of a registered immovable, membership in a building association or an existing or planned building, or preservation of the specified rights.

(3) The provisions concerning consumer credit contracts apply to consumer credit contracts relating to residential immovable property, unless otherwise provided for in this Division.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

  • 403. Application of provisions

(1) Where the credit intermediation activities are carried out as an ancillary activity, the credit intermediary is not required to perform the obligations specified in subsections 541 (6) and (7), subsection 551 (3), §§ 4031 and 4034 and subsections 407 (21) to (23) of this Act. The provisions of this subsection shall not apply to consumer credit contracts relating to residential immovable property.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(2) The provisions of this Division also apply to contracts entered into by a natural person to obtain credit to commence independent economic or professional activities in the case where the credit to be drawn down or the net price of the thing or service to be acquired for the credit does not exceed an amount equivalent to 50,000 euros.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(21) The provisions of this Division also apply to any agreements to amend pre-existing consumer credit contracts which involve postponement of a due date for a charge or payment of additional fees.

[RT I, 11.03.2015, 1 – entry into force 01.10.2015]

(22) The provisions of this Division pertaining to credit intermediaries also apply to any persons engaged in economic or professional activity who arrange for credit to be granted to consumers while the credit is granted by any person who is not engaged in that person’s economic or professional activity. The provisions of this Division apply to credit contracts entered into in the manner specified in the previous sentence.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(3) The provisions of this Division do not apply to credit contracts or credit intermediation contracts:

1) [repealed – RT I 2009, 18, 108 – entry into force 01.05.2009]

2) [repealed – RT I 2009, 18, 108 – entry into force 01.05.2009]

3) entered into between an employer and an employee as an ancillary activity, free of interest or at the annual percentage rate below which is lower than the market average and if the entry into such contract is not offered to third persons;

[RT I 2010, 77, 590 – entry into force 01.07.2011]

4) in the case of which the liability of the consumer for the obligations arising from a consumer credit contract shall be limited only to the value of the pledged thing in the possession of the creditor;

[RT I 2010, 77, 590 – entry into force 01.07.2011]

5) which the consumer enters into with an investment firm or credit institution in the course of provision of ancillary investment services specified in clause 44 2) of the Securities Market Act;

[RT I 2010, 77, 590 – entry into force 01.07.2011]

6) which are of no fixed duration or which is due to be repaid within 12 months, used by the consumer as a temporary financing solution while transitioning to another financial arrangement for the immovable property.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(31) The exclusions provided for in clauses (3) 4) and 5) of this section shall not apply to consumer credit contracts relating to residential immovable property.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(4) The provisions of subsections 407 (21) to (25), (32); (4) and (41) and §§ 414 and 417 shall not apply to consumer credit contracts relating to residential immovable property.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(41) The provisions of § 411 of this Act do not apply to lease contracts which do not prescribe the obligation of the consumer to purchase the object of the contract.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(5) The provisions of §§ 409 and 410 and subsection 414 (2) shall not apply to credit contracts entered into as a judicial compromise.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(51) The provisions of subsection 541 (6), subsection 551 (3), §§ 4031 and 4035, subsections 404 (2) to (22), subsections 407 (4) and (41), § 409, subsection 410 (2), §§ 411, 4141 and 4142 of this Act do not apply to overdraft agreements specified in subsection 407 (21) of this Act. The provisions of this subsection shall not apply to consumer credit contracts relating to residential immovable property.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(52) Only the provisions specified in subsections 407 (4) and (41) and § 415 of this Act apply to the overdraft agreements specified in subsection 407 (4) of this Act. The provisions of this subsection shall not apply to consumer credit contracts relating to residential immovable property.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(53) The provisions specified in subsection 407 (21) of this Act with regard to consumer credit contracts apply to such contracts pursuant to which credit shall be repaid within three months and in the case of which insignificant charges have to be paid.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(54) The provisions of this Division pertaining to consumer credit contracts relating to residential immovable property shall not apply to consumer credit contracts which are entered into with restricted number of consumers under a statutory provision with a general interest purpose and on the terms and conditions which are more favourable to the consumer than those prevailing on the market.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(6) The provisions of this Division apply to consumer credit contracts entered into with a consumer residing in Estonia or in a Member State of the European Union even if the contract is entered into as a result of a public tender, advertising or other similar economic activities in Estonia or if the contract is essentially linked to the territory of Estonia for any other reason, regardless of the state whose law is applicable to the contract.

[RT I 2003, 78, 523 – entry into force 27.12.2003]

  • 4031. Precontractual information

(1) The consumer shall be given the opportunity to compare different offers in order to make an informed decision on entry into the consumer credit contract. For this purpose, the creditor or credit intermediary shall provide the consumer, in good time before the consumer enters into a contract or is bound by their offer, on a durable medium on the Standard European Consumer Credit Information form the following information based on the terms and conditions of the contract of the creditor and, if applicable, preferences expressed and the information submitted by the consumer:

1) the name and address of the creditor;

2) the type of credit;

3) the amount of credit drawn down or the upper credit limit;

4) the terms and conditions of governing the drawdown;

5) the duration of the consumer credit contract;

6) the amount of the principal sum, interest and any other charges (hereinafter repayment) number and frequency of repayments as at the time of submitting the information and, where appropriate, which payments arising from the consumer credit contract are covered by the repayment made by the consumer in the case of outstanding balances charged at different interest rates;

[RT I, 03.12.2012, 1 – entry into force 01.05.2013]

7) the total amount of all the payments made by the consumer for repayment of the credit and the payments made to cover the total cost of the credit;

8) the annual interest rate and the conditions governing the application of that rate. In the case of an unfixed interest rate, the creditor shall specify the periods, conditions and procedure for changing thereof. Where the loan interest depends on the reference interest rate, the reference rate applicable to the initial interest rate shall be specified. If different interest rates apply in difference circumstances, the above mentioned information in respect of all the applicable interest rates;

[RT I, 04.02.2011, 2 – entry into force 01.07.2011]

9) the annual percentage rate;

10) a warning regarding the consequences of missing payments;

11) the annual or daily rate of penalty applicable upon delay of payments and the arrangements for the adjustment thereof, and, where applicable, any costs payable upon a delay;

[RT I, 11.03.2015, 1 – entry into force 01.10.2015]

12) the existence or absence of a right of withdrawal;

13) the right of early repayment, and, where applicable, information concerning the creditor’s right to compensation and the way in which the compensation is determined;

14) the consumer’s right to be informed immediately and free of charge pursuant to subsection 4034 (10) of this Act of the information used for the purposes of assessing the consumer’s creditworthiness;

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

15) the consumer’s right to get a copy of the draft consumer credit contract from the creditor free of charge pursuant to the provisions of subsection (6) of this section.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(2) The creditor or the credit intermediary shall also provide the consumer in addition to the information specified in subsection (1) of this section the following information using the Standard European Consumer Credit Information form:

1) the name and address of the credit intermediary, if the entry into the consumer credit contract is provided by a credit intermediary;

2) charges deriving from the consumer credit contract and the conditions under which those charges may be changed, if the consumer is charged. Such charges include, for example, the charges for maintaining an account recording payment transactions and drawdowns, unless the opening of an account is optional, and charges for using a means of payment for both payment transactions and drawdowns;

3) securities, if securities are required from the consumer;

4) the obligation to enter into a contract where the entry into a collateral contract, in particular an insurance policy, is compulsory in order to obtain the credit or to obtain it on the terms and conditions offered;

5) the obligation to pay notary fees if the consumer is to cover these fees upon entry into the consumer credit contract;

6) a clear and concise statement that the consumer credit contract shall not guarantee the repayment of the credit drawn down under the consumer credit contract if the payments made by the consumer do not give rise to an immediate reduction of the obligation of the consumer to the creditor but are used to constitute capital during periods and under conditions laid down in the credit contract or in a collateral contract. No such statement is submitted if the repayment of the credit drawn down under the consumer credit contract is guaranteed;

7) the period of time during which the creditor is bound by the precontractual information, if the creditor has determined such period of time pursuant to subsection (7) of this section;

8) in the case of a consumer credit contract the object of which is the acquisition of a thing, provision of a service or financing of another object of the contract and in the case of economically linked consumer credit contracts, the thing or service which is the object of the contract and its cash price (net price). In the case of a leasing contract, the price for which the lessor purchases the object of leasing is deemed to be the net price.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(3) The total cost of the credit to the consumer means all the costs, including interest, commissions, taxes and other fees which the consumer is required to pay in connection with the consumer credit contract and which are or should be known to the creditor. The notary fees shall not be taken into account upon calculation of the total cost of the credit. Where a collateral contract, in particular an insurance contract, has to be entered into in order to obtain a credit or to obtain it on the terms and conditions offered, the costs arising from the specified contract, in particular insurance premiums, shall also be taken into account upon calculation of the total cost of the credit.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(4) The total amount of all the payments made by the consumer for the repayment of the credit and covering the total cost of the credit and the annual percentage rate specified in clauses (1) 7) and 9) of this section shall be provided by means of a representative example. The creditor shall specify all the information and assumptions used in order to calculate the annual percentage rate. Where the consumer has informed the creditor of the consumer’s preferred terms and conditions of the contract, such as the duration of the consumer credit contract, amount of credit or upper credit limit, the creditor shall take the information obtained from the consumer into account upon providing a representative example.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(5) Where the consumer credit contract provides different ways of drawdown with different charges or interest rates relating to the consumer credit contract and the creditor uses the assumption provided for in subsection 4061 (2) of this Act, the creditor shall indicate that other drawdown mechanisms for this type of consumer credit contract may result in higher annual percentage rates.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(6) At the request of the consumer, the creditor shall also supply the consumer, free of charge, with a copy of the draft consumer credit contract in addition to the Standard European Consumer Credit Information form, unless the creditor is not willing to continue precontractual negotiations with the consumer.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(7) The creditor may designate a term during which the consumer is bound by the precontractual information provided to the creditor.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(8) The formats of the Standard European Consumer Credit Information form shall be established by a regulation of the minister responsible for the area. The Standard European Consumer Credit Information form shall not be altered or supplemented. Any information which the creditor wishes to supply to the consumer in addition to the provisions of this section shall be provided in a separate document which may be annexed to the Standard European Consumer Credit Information form.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(9) In the case of distance consumer credit contracts, the creditor is deemed to comply with the requirements for information specified in subsections 541 (1) and (3) of this Act if the creditor has provided the Standard European Consumer Credit Information form to the consumer with the information specified in this section and additional information concerning distance marketing of financial services.

[RT I, 31.12.2013, 1 – entry into force 13.06.2014]

(10) The obligation specified in subsection (1) of this section to supply the precontractual information on the Standard European Consumer Credit Information form shall not apply to such consumer credit contracts which are entered into with a restricted number of consumers under a statutory provision with a general interest purpose and on the terms and conditions which are more favourable to consumers than those prevailing on the market or at interest rates which are lower than those prevailing on the market.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(11) The provisions on the obligation to provide precontractual information specified in subsection 14 (2) and § 141 of this Act shall not apply to the obligation to provide precontractual information specified in this section.

[RT I, 31.12.2013, 1 – entry into force 13.06.2014]

  • 4032. Implementation of principle of responsible lending

[Repealed – RT I, 11.03.2016, 1 – entry into force 21.03.2016]

  • 4033. Precontractual information in case of consumer credit contracts relating to residential immovable property

(1) The creditor or the credit intermediary provides the consumer with the personalised precontractual information so that the consumer can compare the consumer credit contracts relating to residential immovable property available on the market, assess the implications of the contracts and make an informed decision on entry into a credit contract. The creditor or credit intermediary provides the consumer with the precontractual information taking into consideration the information received from the consumer on his or her needs, financial situation and preferences in accordance with the provisions of clause 4034 (1) 1) and subsections (2), (3) and (4) of this Act. The consumer is provided with the information without undue delay after receipt of the information specified in the previous sentence from the consumer and at the same time within a reasonable time before the consumer enters into a consumer credit contract relating to residential immovable property or makes a binding offer.

(2) The creditor or the credit intermediary provides the information referred to in subsection (1) of this section to the consumer on a durable medium in the European Standardised Information Sheet.

[RT I, 11.03.2016, 1 – entry into force 01.07.2016]

(3) The format of the European Standardised Information Sheet shall be established by a regulation of the minister responsible for the area.

(4) The European Standardised Information Sheet may not be amended or supplemented, except in the European Standardised Information Sheet or in the cases specified in the instructions on how to complete it. Any information with which the creditor wishes to provide the consumer in addition to the information contained in the information sheet or must provide pursuant to law shall be given in a separate document which may be annexed to the European Standardised Information Sheet.

(5) If an offer is made to the consumer which is binding on the creditor, it is provided on a durable medium together with the European Standardised Information Sheet unless the consumer was already earlier provided with the European Standardised Information Sheet or the characteristics of the offer are different from the information contained in the European Standardised Information Sheet.

(6) If an offer is made to the consumer which is binding on the creditor, the creditor or the credit intermediary shall also provide the consumer, in addition to the European Standardised Information Sheet, a copy of a draft consumer credit contract.

(7) In the case of consumer credit contracts relating to residential immovable property entered into at distance, it shall be deemed that the creditor complies with the requirements on information provided for in subsection 541 (1) of this Act if the consumer has been provided, prior to entry into the contract, with the European Standardised Information Sheet according to this section.

(8) The provisions on the obligation to provide precontractual information specified in subsection 14 (2) and § 141 of this Act do not apply to the obligation to provide precontractual information specified in this section.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

  • 4034. Implementation of principle of responsible lending

(1) A creditor is obliged to comply with the principle of responsible lending in connection with consumer credits. To comply with the principle of responsible lending, the creditor is obliged, prior to entry into a consumer credit contract:

1) to acquire information which allows to assess whether the consumer is able to pay back the credit under the conditions agreed upon in the credit contract (hereinafter creditworthiness) and

2) to assess the creditworthiness of the consumer.

(2) In assessing the creditworthiness of a consumer, the creditor shall adhere to due diligence. In assessing the creditworthiness of the consumer, the creditor shall take into consideration all the circumstances known to the creditor which may have an impact on the consumer’s ability to repay the credit under the terms and conditions agreed upon in the contract, including the consumer’s financial situation, regular income, other financial obligations, performance of earlier payment obligations and the impact of potential increase of the financial obligations arising from the consumer credit contract by means of determining the extent of the required assessment operations according to the terms and conditions of the consumer credit contract, available consumer data and the amount of the financial commitment undertaken. Upon performance of the obligation provided for in previous sentence, the creditor must also be based on the provisions of clauses 49 (1) 1) to 7), clauses (2) 1) to 3), clauses (3) 1) to 3) and subsection (7) of the Creditors and Credit Intermediaries Act.

(3) In order to obtain information necessary for an assessment of creditworthiness, the creditor shall request information from the consumer, if necessary, and use appropriate databases. The consumer must provide the creditor with correct and complete information which is necessary for assessment of his or her creditworthiness.

(4) In order to obtain the information which allows assessing of the creditworthiness of a consumer, a creditor shall inform the consumer about what kind of information specified in subsection (2) of this section, which evidence to prove it and during which term the consumer must submit to the creditor. The creditor verifies the information provided by the consumer according to subsections 50 (3) and (4) of the Creditors and Credit Intermediaries Act.

(5) The creditor shall not promote or encourage the consumer not to provide the information required for the assessment of the credit status of the consumer. The creditor shall warn the consumer that if the consumer fails to provide the information or evidence necessary for assessment of the creditworthiness and therefore the creditor is unable to assess the creditworthiness of the consumer, no consumer credit contract can be entered into with the consumer.

(6) The creditor may enter into a consumer credit contract with the consumer only in the case the creditor is sure as a result of analysing the data constituting the basis for the assessment of creditworthiness in aggregate that the consumer is creditworthy.

(7) If the creditor violates the provisions of subsection (6) of this section, the interest rate of the consumer credit contract shall be deemed to be the interest rate provided for in § 94 of this Act, unless this is higher than the interest rate earlier agreed upon. The consumer shall owe no other fees to the creditor in this case. The creditor shall redetermine the repayments taking into account the reduction of the interest rate and other expenses, and communicate these to the consumer. The provisions of this subsection shall not apply if the consumer intentionally did not provide information according to subsections (3) and (4) of this section or falsified the information provided to the creditor and as a result thereof the creditor made an incorrect assessment of the creditworthiness of the consumer.

(8) In addition to the provisions of subsection (7) of this section, the consumer has the right to use other appropriate legal remedies, except for compensation for damage to the extent which is covered by reduction of the interest rate.

(9) Where the creditor and the consumer agree to change the amount of credit drawn down by the consumer or the upper credit limit after the entry into the consumer credit contract, the creditor shall update the information at the disposal of the creditor concerning the creditworthiness of the consumer and assess the creditworthiness of the consumer each time before changing the amount of the credit or upper limit of the credit.

(10) If the decision not to enter into a consumer credit contract with the consumer is made on the basis of consulting any databases, the creditor shall inform the consumer immediately and free of charge of the results of such consultation and of the details of the databases used. The information obtained from databases shall not be provided if the provision of such information is prohibited by legislation or is contrary to objectives of public policy or public security.

(11) If the creditor decides not to enter into a consumer credit contract relating to residential immovable property with the consumer, the creditor shall immediately inform the consumer of its decision, and if the decision is based on automated processing of data, even of this fact.

(12) The creditor is not obliged to assess the creditworthiness of the consumer if the consumer credit contract to be entered into is a contract which is entered into with a restricted number of consumers under a statutory provision with a general interest purpose and on the terms and conditions which are more favourable to the consumer than those prevailing on the market or at interest rates which are lower than those prevailing on the market.

(13) If necessary, a creditor shall demonstrate the performance of the obligations required for compliance with the principles of responsible lending.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

  • 4035. Provision of explanations to consumers

(1) Prior to entry into a consumer credit contract, the creditor is obliged to provide the consumer with adequate explanations in order to place the consumer in a position enabling the consumer to assess whether the proposed consumer credit contract corresponds to the needs and the financial situation of the consumer. In the case of consumer credit contracts relating to residential immovable property, the creditor or the credit intermediary is obliged to also provide the consumer, in addition to the explanations given according to the previous sentence, with explanations of the ancillary agreement proposed to the consumer so that the consumer could assess whether the ancillary agreement corresponds to the needs and financial situation of the consumer.

(2) If it may be presumed that the consumer needs or requests additional explanations concerning the precontractual information provided pursuant to § 4031 of this Act, the essential characteristics and effect that the contracts proposed to the consumer may have on the consumer, including consequences of payments delayed by the consumer, then the creditor or credit intermediary is obliged to provide additional explanations to the consumer and warn the consumer of potential risks upon obtaining a consumer credit.

(3) In the case of consumer credit contracts relating to residential immovable property, the explanations shall in particular include:

1) the precontractual information provided to the consumer according § subsection 4033 of this Act, if the explanations are given by the creditor, and the precontractual information provided pursuant to §§ 4033 and 4171 of this Act if the explanations are given by the credit intermediary;

2) the essential characteristics of the products proposed;

3) the specific effects which the products proposed may have on the consumer, including the consequences of default in payment by the consumer; and

4) information about whether the contract can be terminated separately and the implications for the consumer for doing so, where ancillary agreements are bundled with a consumer credit contract.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

  • 404. Application of consumer to enter into contract

(1) In the case of a consumer credit contract, an application submitted by a consumer to assume obligations shall be in a format which can be reproduced in writing. The contract or a copy of the contract shall be promptly given to the consumer on a durable medium.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(2) A declaration of intent of the consumer shall set out the following information in a clear and concise manner:

1) the name and address of the consumer;

2) the information specified in clauses 4031 (1) 1) to 11) of this Act;

3) the right of the consumer to request from the creditor, free of charge and at any time throughout the duration of the consumer credit contract, the consumer credit contract amortisation table which specifies the term of repayment of the principal sum;

4) a statement showing the periods and conditions for the payment of the interest and of any associated recurrent and non-recurrent charges if the charges and interest have to be paid without repaying the principal sum of the credit;

5) the existence or absence of the right of withdrawal, the period during which that right may be exercised and other conditions governing the exercise thereof, including information concerning the obligation of the consumer pursuant to subsection 409 (3) of this Act to repay the principal sum of the credit and the interest accrued thereon from the date the credit was drawn down until the date of repayment thereof to the creditor, and the amount of interest per day;

[RT I, 04.02.2011, 2 – entry into force 01.07.2011]

6) in the case of an economically linked consumer credit contract, the rights arising from § 414 of this Act and the procedure for the exercise thereof;

7) the procedure for cancellation of consumer credit contracts;

8) the right of early repayment, the procedure for early repayment, as well as information concerning the creditor’s right to compensation and the way in which that compensation will be calculated;

9) the name and address of the competent supervisory authority;

10) the information concerning the possibility for out-of-court resolution of disputes arising from consumer credit contracts;

11) the securities and insurance required from the consumer, if required;

12) the information specified in clauses 4031 (2) 2), 5) and 6) of this Act;

(13) where applicable, other contractual terms and conditions.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(21) The annual percentage rate specified in clauses 4031 (1) 7) and 9) of this Act and the total amount of all the payments made by the consumer for repayment of the credit and the payments made to cover the total cost of the credit shall be calculated as at the time of entry into the consumer credit contract and all the information and assumptions used in order to calculate the annual percentage rate shall be specified in the contract.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(22) At the request of the consumer, the creditor shall make available to the consumer, free of charge and at any time throughout the duration of the consumer credit contract, an amortisation table specified in this clause (2) 3) of this section. The amortisation table shall indicate the amounts owing and the due dates and conditions of repayment of such amounts. The table shall contain a breakdown of each repayment showing the repayment of the principal sum of the credit, the interest calculated on the basis of the annual interest rate and any additional costs, where the consumer is required to pay additional costs. In the case of an unfixed interest rate consumer credit contract or in the case the additional costs may be changed under the consumer credit contract, the amortisation table shall indicate, clearly and concisely, that the data contained in the table remain valid only until such time as the interest rate or the additional costs are changed in accordance with the consumer credit contract.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(23) Upon entry into consumer credit contracts relating to residential immovable property, a declaration of intent of the consumer must indicate, in addition to the information provided for in subsection (2) of this section, the following information in a clear and concise manner:

1) the name and address of the credit intermediary, if the entry into the consumer credit contract relating to residential immovable property is provided by a credit intermediary;

2) the currency of the credit;

3) the information stating that the consumer credit contract is in foreign currency, if it is such a contract;

4) the maximum credit amount in the national currency of the consumer, if it is a consumer credit contract in foreign currency and the parties agree upon such maximum amount;

5) the conditions for converting the consumer credit contract into the national currency of the consumer or another procedure applied to limit the exchange rate risk for the consumer on the basis of the credit contract, if it is a foreign currency consumer credit contract;

6) if applicable, the information on that during the term of the consumer credit contract, the consumer shall pay only interest (interest-only consumer credit contract);

7) the amount owed by the consumer after the expiry of the consumer credit contract, if it is an interest-only consumer credit contract;

8) the assumed value, at the time of entry into the contract, of the registered immovable over which the security is created, if the consumer is required to create such a security;

9) information on the law applicable to the consumer credit contract, if the contract is entered into at a distance.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(3) [Repealed – RT I 2010, 77, 590 – entry into force 01.07.2011]

(4) [Repealed – RT I 2010, 77, 590 – entry into force 01.07.2011]

  • 4041. Information concerning interest rate

(1) Changes of interest rates shall enter into force in the case of a consumer credit contract if the creditor has notified the consumer beforehand, on a durable medium, of the change in the interest rate. The information shall state the amount of payments due after the entry into force of the new interest rate and where the number or frequency of the payments changes, the respective particulars thereof.

(2) The parties may agree in the consumer credit contract that the information specified in subsection (1) shall be provided to the consumer periodically in the cases where the change in the interest rate is caused by a change in a reference rate, and the new reference rate is made publicly available by appropriate means and the information concerning the new reference rate is available in the premises of the creditor. In the case of consumer credit contracts relating to residential immovable property, the creditor provides the consumer with the information on the reference interest rate in addition to the information provided for in subsection (1) of this section.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(3) Where changes in the interest rates of consumer credit contracts relating to residential immovable property are determined by way of auction on the capital markets and it is therefore impossible for the creditor to inform the consumer of any change before the change takes effect, the creditor shall, within reasonable time before the auction, inform the consumer on a durable medium thereof and provide information on how the interest rate can be affected by the auction.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

  • 405. Contracts to finance acquisition of things or provision of services

1) In the case of a consumer credit contract the object of which is the acquisition of a thing, provision of a service or financing of another object of the contract and in the case of economically linked consumer credit contracts, the following shall be indicated in the contract:

1) In the case of a consumer credit contract the object of which is the acquisition of a thing, provision of a service or financing of another object of the contract and in the case of economically linked consumer credit contracts, the following shall be indicated in the contract:

1) a description of the thing, service or other performance of an act which is the object of the contract;

2) the price of the thing or service acquired for the credit, if payment is to be made immediately (net price);

21) the information specified in subsections 404 (2) and (21) of this Act.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(2) [Repealed – RT I 2010, 77, 590 – entry into force 01.07.2011]

(3) In the case of a leasing contract, the price for which the lessor purchases the object of leasing is deemed to be the net price.

(4) [Repealed – RT I 2010, 77, 590 – entry into force 01.07.2011]

  • 406. Annual percentage rate

(1) The annual percentage rate of the credit is the total cost of the credit to the consumer expressed as an annual percentage of the credit amount drawn down or the upper credit limit provided that the consumer credit contract is valid for the agreed term and that the creditor and the consumer fulfil their obligations under the terms and conditions and by the dates agreed upon in the consumer credit contract.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(2) The total cost of the credit to the consumer determined upon calculation of the annual percentage rate of the credit does not contain the costs which the consumer is required to bear upon violation of the obligations arising from the contract, or costs which the consumer is required to bear in connection with the acquisition of a thing or the use of a service. Upon calculation of the annual percentage rate, the price of the thing or the charge for the use of the service shall be taken into account regardless of whether the payment for the thing or the use of the service is made by means of drawing down the credit or not.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(3) The costs of the charges for using the means of payment enabling the payment transactions and drawdowns, and charges for maintaining such an account where the payment transactions and drawdowns are made and other charges relating to payment transactions shall be taken into account upon calculation of the total cost of the credit, unless the opening of the account is optional and the costs of the account have been clearly and separately shown in the consumer credit contract or in any other contract entered into with the consumer.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(4) [Repealed – RT I 2010, 77, 590 – entry into force 01.07.2011]

(5) If changes in the interest rate or changes unquantifiable at the time of calculation have been agreed, the consumer credit contract shall set out, instead of the annual percentage rate, the initial annual percentage rate based on the initial interest rate and other conditions at the time of entry into the contract as if they were to be applicable during the whole term of the contract.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(51) If it is known at the time of entry into force of the credit contract that certain costs will change upon expiry of a specific period, this shall be taken into account upon calculation of the rate.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(52) In the case of consumer credit contracts relating to residential immovable property for which a fixed interest rate is agreed initially for at least five years and at the end of which negotiations are held for determining a fixed interest rate for a new period of substantial length, the additional illustrative annual percentage rate in the European Standardised Information Sheet shall take into consideration only the period with the initially fixed interest rate and the calculation is based on the assumption that the outstanding principal amount shall is repaid at the end of the fixed interest rate period.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(53) Where consumer credit contracts relating to residential immovable property allow for variations in the interest rate according to the consumer credit contracts, the consumer shall be informed of possible impacts of variations in the interest rate on the amounts payable and on the annual percentage rate at least in the European Standardised Information Sheet. For this purpose, the consumer shall be also provided another annual percentage rate, which illustrates the possible risks linked to a significant increase in the interest rate. Where the interest rate is not capped, this information shall be accompanied by a warning which highlights that the total cost of the credit for the consumer, shown in the annual percentage rate, may change. The provisions of this subsection do not apply in the case specified in subsection (52) of this section.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(6) The specific procedure for calculation of the annual percentage rate based on the requirements of the European Union shall be established by the minist

  • 4061. Additional assumptions for calculation of annual percentage rate

(1) If a consumer credit contract allows the consumer to choose the time of drawdown by the consumer, the total amount of the credit shall be deemed to be drawn down immediately and in full upon calculation of the annual percentage rate.

(2) If a consumer credit contract provides different ways of drawdown with different charges and interest rates, the total amount of the credit shall be deemed to be drawn down at the highest charges and interest rate applied to the most common drawdown mechanism for this type of consumer credit contracts.

(3) If a consumer credit contract provides different ways of drawdown but the consumer credit contract imposes, among the different ways of drawdown, a limitation with regard to the amount and period of time, the total amount of the credit shall be deemed to be drawn down on the earliest date provided for in the contract in accordance with those drawdown limitations upon calculation of the annual percentage rate.

[RT I, 03.12.2012, 1 – entry into force 01.05.2013]

(4) If it is not an overdraft, it is deemed upon calculation of the annual percentage rate in the case of a consumer credit contract for an unspecified term and a consumer credit contract pursuant to which the credit has to be repaid within a certain term or after the expiry of a certain term, whereafter drawdown is possible again, that:

1) the credit is provided for a period of one year as of the first drawdown of the credit and the consumer shall repay with the last payment the whole remaining principal sum, interest and other charges, if any;

2) the credit drawn down shall be repaid in twelve equal repayments at equal intervals as of when one month has passed from the first drawdown of the credit. If the principal sum has to be repaid in full during each payment term as a single payment, it shall be deemed upon calculation of the annual percentage rate that thereafter the credit is drawn down and the repayments are made within one year;

3) the interest and other charges are calculated on the credit drawn down pursuant to the consumer credit contract and the interest and other charges are paid together with the repayments of the principal sum.

[RT I, 03.12.2012, 1 – entry into force 01.05.2013]

(41) If it is not an overdraft, it is deemed upon calculation of the annual percentage rate in the case of a consumer credit contract relating to residential immovable property for an unspecified term and a consumer credit contract relating to residential immovable property pursuant to which the credit has to be repaid within a certain term or after the expiry of a certain term, whereafter drawdown is possible again, that:

1) the credit is provided for a period of 20 year as of the first drawdown of the credit and the consumer shall repay with the last payment the whole remaining principal sum, interest and other charges, if any, provided the objective of the consumer credit contract is to acquire or retain a right relating to immovable property;

2) the credit is provided for a period of one year as of the first drawdown of the credit and the consumer shall repay with the last payment the whole remaining principal sum, interest and other charges, if any, provided the objective of the consumer credit contract is not to acquire or retain a right relating to immovable property or if, in the case of a consumer credit contracts, the credit is drawn down by deferred debit cards or credit cards;

3) the credit drawn down shall be repaid in equal monthly payments at equal intervals after one month has passed from the first drawdown of the credit. If the principal sum has to be repaid in full during each payment term as a single payment, it shall be deemed upon calculation of the annual percentage rate that thereafter the credit is drawn down and the repayments are made within one year;

4) the interest and other charges are calculated on the credit drawn down pursuant to the consumer credit contract and are paid together with the repayments of the principal sum.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(5) If it is not an overdraft or a contract specified in subsections (4), (41), (11) and (12) of this section and if the amount of repayments is not determined, the amount of each repayment shall be deemed upon calculation of the annual percentage rate that it is the lowest for which the contract provides.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(6) If it is not an overdraft or a contract specified in subsections (4), (41), (11) and (12) of this section and if the date of making the repayments is not determined, it shall be deemed upon calculation of the annual percentage rate that the repayment is made on the earliest date provided for in the contract.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(61) If it is not an overdraft or a contract specified in subsections (4), (41), (11) and (12) of this section and if the date of entry into a consumer credit contract is unknown, it shall be deemed upon calculation of the annual percentage rate that the credit is first drawn down on the due date which will result in the shortest period of time between the due date of drawing down the credit and the due date of the first repayment.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(7) If the consumer credit contract does not specify the upper credit limit, it shall be deemed upon calculation of the annual percentage rate that the upper credit limit is 1500 euros.

(71) If a consumer credit contract relating to residential immovable property does not specify the upper credit limit, it shall be deemed upon calculation of the annual percentage rate that the upper credit limit is 170,000 euros. In the case of consumer credit contracts relating to residential immovable property which objective is not to acquire or retain any rights relating to immovable property or land, except for the credit contracts specified in subsection (11) of this section, or in the case of which the credit is drawn down as overdrafts or by deferred debit cards or credit cards, it shall be deemed upon calculation of the annual percentage rate that the upper credit limit is 1500 euros.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(8) In the case of overdraft facilities the total amount of the credit shall be deemed to be drawn down for the whole duration of the of the overdraft agreement. If the duration of the overdraft agreement is not known, the percentage rate shall be calculated on the assumption that the duration of the overdraft agreement is three months.

(81) If the date of making the repayment or the amount of the repayment cannot be determined pursuant to the consumer credit contract or the conditions provided for in subsections (4), (41, (5), (6), (61), (8), (11) or (12) of this section, it shall be deemed upon calculation of the annual percentage rate that the repayment is made on the due date and on the terms and conditions specified by the creditor.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(82) If the terms and conditions specified in subsection (81) of this section are unknown, it shall be deemed upon calculation of the annual percentage rate that:

1) the interest is paid together with the repayments of the principal sum of the credit;

2) a single other charge, which is not interest, shall be paid on the day of entry into the consumer credit contract;

3) other multiple charges, which are not interest, shall be paid at regular intervals as of the due date of the first repayment of the principal sum and if the amount thereof is unknown, it shall be deemed that they are equal amounts;

4) the last payment shall pay the whole remaining principal sum, interest and other charges, if any.

[RT I, 03.12.2012, 1 – entry into force 01.05.2013]

(9) If different interest rates and charges are offered to the consumer within a specified period, the interest rate and charges shall be deemed to be the agreed highest interest rate and the highest charges throughout the duration of the consumer credit contract upon calculation of the annual percentage rate.

(10) In the case of consumer credit contracts for which a fixed interest rate is agreed for the initial period, which is subsequently regularly adjusted according to an agreed indicator, it shall be deemed upon the calculation of the annual percentage rate that starting from the end of the fixed interest rate period the interest rate is the interest rate deriving from the value of the agreed indicator in force at the time of calculation of the annual percentage rate.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(11) In the case of consumer credit contracts relating to residential immovable property which act as a guarantee to another separate but ancillary transaction and in the case of which the principal credit sum secured against the immovable property is drawn down only in the case any event determined in the contract occurs, it shall be deemed upon calculation of the annual percentage rate that the credit is drawn down in full at the earliest of:

1) the latest draw down day of the credit which is permitted under the credit contract being the potential source of the liability or guarantee; or

2) in the case of a rolling credit contract at the end of the initial period prior to the rollover of the contract.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(12) In the case of consumer credit contracts relating to residential immovable property, where the repayable principal sum of credit is based on a contractually set percentage of the value of the immovable property at the time of the principal sum repayment or repayments, it shall be deemed upon calculation of the annual percentage rate that:

1) the consumer makes the repayment on the latest day or days permitted under the consumer credit contract;

2) the percentage increases in value of the immovable property which secures the consumer credit contract, and the rate of any inflation index referred to in the contract, shall be assumed to be a percentage equal to the higher of the current Eesti Pank target inflation rate or the level of inflation in the Member State where the immovable property is located at the time of entry into the credit contract or zero, if those percentages are negative.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

  • 4062. Maximum annual percentage rate

(1) A consumer credit contract is void, if the annual percentage rate payable by the consumer exceeds at the time of granting the credit the past six months’ average annual rate of consumer credits granted by credit institutions to private individuals and last published by Eesti Pank for more than three times. The calculation of the average annual percentage rate of consumer loans granted to private individuals by credit institutions specified in this subsection shall not take into account the consumer loans secured by mortgage. The publishing of the average annual percentage rate shall be arranged by 1 January and 1 July of each year by Eesti Pank on its website.

(2) In the event of assessment of conformity of the annual percentage rate payable by a consumer with the maximum annual percentage rate provided for in subsection (1) of this section, the costs relating to insuring of the object of leasing shall not be taken into account upon calculation of the annual percentage rate payable by consumers in the case of leasing contracts.

(3) If a consumer credit contract is void pursuant to the provisions of subsection (1) of this section, the consumer shall repay the amount received on the basis of the void consumer credit contract by the date by which the consumer had to repay the whole credit according to the void consumer credit contract. In this case, interest is due for the period of use of the credit at the rate provided for in subsection 94 (1) of this Act. The prerequisites provided for in § 4061 of this Act shall apply to the determination of the terms and conditions for repayment of any amounts received on the basis of consumer credit contracts entered into for an unspecified term. The creditor shall redetermine the repayments and dates for repayments taking into account the reduction of the interest rate and other expenses, and communicate these to the consumer.

[RT I, 12.03.2015, 5 – entry into force 01.07.2015]

  • 407. Overdraft agreement

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(1) An overdraft agreement means a consumer credit contract whereby a creditor permits the consumer to overdraw the payment account by a particular amount. The provisions concerning consumer credit contracts apply to overdraft agreements with the specifications provided for in this section.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(2) [Repealed – RT I 2010, 77, 590 – entry into force 01.07.2011]

(21) The consumer shall be given the opportunity to compare different offers in order to make an informed decision on entry into the overdraft agreement pursuant to which the credit has to be repaid on demand of the creditor or within three months. For this purpose, the creditor or credit intermediary shall provide the consumer in good time before the consumer enters into a contract or is bound by his offer, on a durable medium, the following information based on the terms and conditions of the contract of the creditor and, if applicable, preferences expressed and the information submitted by the consumer:

1) the information specified in clauses 4031 (1) 1), 2), 3), 5), 11), 14) and 15) of this Act;

2) the information specified in clause 4031 (2) 1) of this Act in the case of credit intermediation;

(3) the information concerning that the consumer may be requested to repay the amount of credit in full on demand at any time;

4) the annual interest rate and the conditions governing the application of that rate. Where the loan interest depends on the reference interest rate, the reference rate applicable to the initial interest rate shall be specified;

5) the annual percentage rate by means of a representative example indicating all the information and assumptions used in order to calculate the annual percentage rate;

6) the charges due from the time the contract is entered into and, where applicable, the conditions under which those charges may be changed;

7) the period of time during which the creditor is bound by the precontractual information, if the creditor has determined such period of time pursuant to subsection 4031 (7) of this Act.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(22) The information specified in subsection (21) of this section shall be provided in a clear and comprehensible manner. For the purpose of providing the information specified in subsection (21) of this section, the creditor or the credit intermediary may use the European Consumer Credit Information form established by a regulation of the minister responsible for the area for overdrafts.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(23) In the case of a distance contract specified in subsection (21) of this section, the creditor has fulfilled the information requirements specified in subsections 54 (11) and (2) of this Act if the creditor has provided the Standard European Consumer Credit Information form to the consumer for overdraft with the information specified in subsection (21) of this section and additional information concerning distance marketing of financial services.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(24) The contract specified in subsection (21) of this section shall provide, in a clear and comprehensible manner, the following information:

1) the information specified in clauses 4031 (1) 1) to 5) and 8) of this Act;

2) the information specified in clause 4031 (2) 1) of this Act;

3) the information specified in clause 404 (2) 1) of this Act;

4) the annual percentage rate and the total cost of the credit to the consumer;

5) the information specified in subsection clauses (21) 3) and 6) of this section.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(25) The annual percentage rate and the total cost of the credit to the consumer shall be calculated as at the time of entry into the overdraft agreement and the contract shall specify all the information and assumptions used in order to calculate the annual percentage rate.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(3) [Repealed – RT I 2010, 77, 590 – entry into force 01.07.2011]

(31) The creditor shall notify the consumer regularly by providing a statement of account to the consumer a durable medium. A statement of account shall set out the following information:

1) the precise period to which the statement of account relates;

2) amounts drawn down by the consumer and dates of drawdowns;

3) the balance from the previous statement, and the date thereof;

4) the new balance;

5) the dates and amounts of payments made by the consumer;

6) applicable interest rate;

7) applicable charges;

8) the minimum amount to be paid if so agreed.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(32) Changes of interest rates shall enter into force in the case of an overdraft agreement with unfixed interest rate if the creditor has notified the consumer beforehand on a durable medium of the change in the interest rate. In the overdraft agreement the parties may agree that the information concerning the change of the interest rate shall be provided in the manner specified in subsection (31) of this section in the cases where the change in the interest rate is caused by a change in a reference rate, the new reference rate is made publicly available by appropriate means and the information concerning the new reference rate is available in the premises of the creditor.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(4) In the absence of an agreement to grant an overdraft and if the creditor allows the consumer to overrun the payment account or if the creditor permits the consumer to overrun the upper overdraft limit agreed upon in the overdraft agreement, the consumer shall be notified of the circumstances specified in clauses (21) 4) and 6) of this section. The creditor shall provide that information regularly on a durable medium.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(41) In the case of a consumer credit contract specified in subsection (4) of this section, the creditor shall inform the consumer without delay on a durable medium in the event of a significant overrunning of the payment account exceeding the period of one month:

1) of the overrunning;

2) of the amount of such overrunning;

3) of the interest rate;

4) of any contractual penalties, charges or interest on arrears applicable.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(5) [Repealed – RT I 2010, 77, 590 – entry into force 01.07.2011]

(6) The provisions on the obligation to provide precontractual information specified in subsection 14 (2) and § 141 of this Act shall not apply to the obligation to provide precontractual information specified in this section.

[RT I, 31.12.2013, 1 – entry into force 13.06.2014]

  • 408. Consequences of failure to conform with format of contract

(1) A consumer credit contract is void upon failure to comply with the requirement for format provided for in subsection 404 (1) of this Act or the absence of any of the information provided for in §§ 404 or 405 of this Act.

(2) In the absence of the information provided for in subsection 404 (2) or (23) of this Act, a credit contract becomes valid if the consumer receives the loan or begins to use the credit.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(3) In the absence of information provided for in § 405 of this Act, a credit contract becomes valid if the thing is delivered or service is provided to the consumer or another obligation is performed with respect to the consumer.

(4) If, in the case specified in subsection (2) of this section, there is no information on the interest rate, annual percentage rate or initial annual percentage rate, or the gross amount of all the payments to be made by the consumer in order to repay the credit and bear the total cost of the credit, the interest rate provided for in § 94 of this Act is deemed to be the interest rate, unless this is higher than the interest rate previously agreed. If, in the case specified in subsection (2) of this section, there is no information on other expenses owed by a consumer, the consumer does not owe costs of which the consumer is not informed. The creditor shall re-determine the repayments taking into account the reduction in the interest rate and other costs and inform the consumer thereof.

[RT I, 03.12.2012, 1 – entry into force 01.05.2013]

(5) If, in the case specified in subsection (3) of this section, there is no information on the gross amount of all the payments to be made by the consumer in order to repay the credit and bear the total cost of the credit, the annual percentage rate or the initial annual percentage rate, the interest rate shall not be higher than the interest rate provided for in § 94 of this Act unless this is higher than the interest rate previously agreed. If, in the case specified in subsection (3) of this section, there is no information on other expenses owed by a consumer, the consumer does not owe costs of which the consumer is not informed. The creditor shall re-determine the repayments taking into account the reduction in the interest rate and other costs and inform the consumer thereof.

[RT I, 03.12.2012, 1 – entry into force 01.05.2013]

(6) If, in the case specified in subsection (2) of this section, the prerequisites for changing the conditions which affect the size of the costs relating to credit are not communicated to the consumer, the size of the costs relating to the credit shall not be changed to the detriment of the consumer.

(7) If, in the case specified in subsection (3) of this section, the net price is not communicated to the consumer, the market price is deemed to be the net price.

(8) If, upon entry into a consumer credit contract, the creditor has not informed the consumer of the security which is required from the consumer, security may be demanded later only if the net amount of credit exceeds an amount equivalent to 50,000 euros.

(9) If the annual percentage rate is indicated in a consumer credit contract as being lower than the actual rate, the rate of interest which is agreed in the consumer credit contract shall be reduced by the percentage rate by which the indicated annual percentage rate is lower than the actual rate.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(10) If penalties for late payment are not expressed as annual and daily rates, the creditor has the right to demand penalties for late payment from a consumer only at the rates of the penalties for late payment provided for in the second sentence of subsection 113 (1) of this Act.

[RT I, 11.03.2015, 1 – entry into force 01.10.2015]

  • 409. Right of consumer to withdraw

(1) A consumer may withdraw from a consumer credit contract within 14 days without giving a reason. In the case of consumer credit contracts relating to residential immovable property, the consumer may cancel the consumer credit contract within seven days. If a consumer withdraws from a consumer credit contract, a person who joined in an obligation arising from the consumer credit contract may also withdraw from the contract.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(2) The term specified in subsection (1) of this section commences to run as of the date of entry into the consumer credit contract or as of the date when the consumer received the contractual terms and conditions and the information specified in § 404 of this Act, if this date is later than the date of entry into the contract.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(21) If a consumer exercises the right to withdraw from a contract specified in subsection (1) of this section, the application for withdrawal shall be submitted before the expiry of the term specified in subsection (1).

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(3) The consumer shall repay the creditor immediately, but not later than within 30 days after submitting an application for withdrawal, the principal sum of the credit and the interest on the principal sum as of the drawdown of the credit until repayment of the principal sum. In the event of withdrawal, the creditor shall have no right to demand any other compensation from the consumer besides the non-returnable charges paid by the creditor based on a public law relationship in the credit relationship. The provisions of §§ 188-192 of this Act apply to other consequences of withdrawal.

[RT I, 31.12.2013, 1 – entry into force 13.06.2014]

(31) If the consumer fails to repay the credit within the term specified in the first sentence of subsection (3) of this section, the consumer is deemed not to have withdrawn from the contract.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(32) If the consumer exercises the right of withdrawal specified in this section with regard to the consumer credit contract, the consumer is deemed to have withdrawn from the collateral contract linked to the consumer credit contract which objective is to provide a service or another benefit and which the creditor or a third person provides based on an agreement between the third person and the creditor.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(4) If the consumer withdraws from a consumer credit contract which is economically linked to a contract of sale for the purposes of § 414 of this Act, the provisions of § 414 of this Act apply to withdrawal from the contract of sale.

[RT I, 31.12.2013, 1 – entry into force 13.06.2014]

(41) In the case of withdrawal from a leasing contract, the expenses relating to the return of the thing or compensation for services and the related risks shall be borne by the creditor. The parties may agree that the consumer bears the regular expenses relating to the return of the thing to the extent of 10 euros, except in cases where the thing delivered or service provided is not that which was ordered. If a consumer is not notified of the right of withdrawal, the consumer shall, in the case of withdrawal, be liable only for any damage caused to the thing intentionally or through gross negligence. The provisions of §§ 188-192 of this Act apply to other consequences of withdrawal.

[RT I, 31.12.2013, 1 – entry into force 13.06.2014]

(5) [Repealed – RT I 2010, 77, 590 – entry into force 01.07.2011]

(6) [Repealed – RT I 2010, 77, 590 – entry into force 01.07.2011]

(7) [Repealed – RT I 2010, 77, 590 – entry into force 01.07.2011]

(8) Contract terms which impede the right of withdrawal from being exercised, in particular agreements pursuant to which withdrawal is bound to payment of earnest money or a contractual penalty, are void.

[RT I, 31.12.2013, 1 – entry into force 13.06.2014]

  • 410. Consumer credit contract entered into as off-premises contract and distance contract

[RT I, 31.12.2013, 1 – entry into force 13.06.2014]

(1) The formal requirement specified in subsection 404 (1) of this Act shall not preclude distance consumer credit contracts. The contract or a copy of the contract shall be promptly given on a durable medium to the consumer having entered into a distance consumer credit contract.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(2) The consumer may withdraw from a consumer credit contract entered into as an off-premises contract or distance contract without specifying the reason for withdrawal only pursuant to the procedure and in the manner provided for in § 409 of this Act.

[RT I, 31.12.2013, 1 – entry into force 13.06.2014]

(3) [Repealed – RT I 2010, 77, 590 – entry into force 01.07.2011]

  • 411. Right of consumers to early repayment

(1) A consumer may perform the obligations arising from a consumer credit contract in part or in full before the prescribed time. In such case, the consumer does not owe interest or other charges for the period when the credit is not used.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(11) If the early repayment of the credit falls within the period for which the interest rate is fixed, the creditor has the right to demand only reasonable compensation from the consumer for the damage directly linked to early repayment of the credit. The damage shall be determined in particular based on the opportunity of the creditor to lend out the repaid credit on the loan market due to early repayment, taking into account the savings of the creditor due to early repayment.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(12) The amount of the compensation specified in subsection (11) of this section shall not exceed one percent of the amount of the credit repaid early, if the period of time between the early repayment of the credit and termination of the consumer credit contract agreed in the consumer credit contract exceeds one year, and 0.5 percent of the amount of the credit repaid early, if this period does not exceed one year.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(13) The creditor shall not demand the compensation specified in subsection (11) of this section from the consumer, if the credit is repaid based on an insurance contract entered into for securing the repayment of the credit, in the case of overdraft facilities, or within the period for which the interest is not fixed.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(14) If the credit specified in subsection (11) of this section is a credit relating to residential immovable property, the limitations specified in subsection (12) of this section shall not preclude the right of the creditor to claim additional compensation from the consumer, if the creditor suffered a bigger loss due to early repayment of the credit.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(2) [Repealed – RT I 2010, 77, 590 – entry into force 01.07.2011]

(3) [Repealed – RT I 2010, 77, 590 – entry into force 01.07.2011]

(4) If the early repayment of a consumer credit contract relating to residential immovable property falls within the period for which the interest rate is not fixed, the creditor may claim from the consumer, differently from the provisions of the second sentence of subsection (1) of this section, the amount of interest lost for the term of three following months.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(5) The compensation claimed from the consumer subject to this section shall not exceed the amount which the consumer would have paid as interest during the period between the early repayment and the date of expiry of the consumer credit contract.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(6) The creditor shall have no right to demand compensation from the consumer on the basis of subsections (11), (14) or (4) of this section if the creditor failed to comply with the provisions of clause 4034 (6) of this Act. The provisions of this subsection shall not apply if the consumer intentionally did not provide information according to subsections 4034 (3) and (4) of this Act or falsified the information provided to the creditor and as a result thereof the creditor made an incorrect assessment of the credit worthiness of the consumer.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(7) If the consumer informs the creditor of a desire to perform the obligations arising from the consumer credit contract relating to residential immovable property before the due date, the creditor shall provide the consumer immediately on a durable medium with the information necessary to consider that option. The information provided to the consumer shall contain the following data:

1) the early repayment amount;

2) the amount of the compensation demanded from the consumer according to subsections (11), (14) or (4) of this section;

3) the assumptions used which shall be reasonable and justifiable.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

  • 412. Assignment of claims of creditor arising from consumer credit contract

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(1) If the creditor assigns a claim arising from the consumer credit contract, the consumer shall be informed of the assignment of the claim, unless the creditor continues to be an obligee with respect to the consumer by agreement with the new obligee.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(2) Agreements which preclude or restrict the right of a consumer to plead defences arising from a contract against third parties to whom the obligee assigns the claims arising from the consumer credit contract against the creditor or which preclude or restrict the right of set-off of the consumer are void.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

  • 413. Use of bills of exchange and cheques

(1) Consumers shall not be required to give security for claims arising from a consumer credit contract by means of bills of exchange or to issue cheques, and creditors shall not accept such bills of exchange or cheques.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(2) If a bill of exchange or cheque specified in subsection (1) of this section is accepted, the consumer may reclaim this from the creditor at any time. The creditor shall compensate the consumer for the costs and damage caused by issue of the bill of exchange or cheque.

  • 414. Effect of withdrawal on economically linked contract of sale

[RT I, 31.12.2013, 1 – entry into force 13.06.2014]

(1) A contract of sale forms a contract linked to a consumer credit contract if the purpose of the credit contract is to finance the payment of a purchase price and both contracts are deemed to be economically uniform. Contracts are deemed to be economically uniform if the seller grants credit for financing the purchase price, if the creditor uses the assistance of a seller in preparing or entering into the consumer credit contract or if the object of the contract of sale is explicitly specified in the consumer credit contract.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(2) If a consumer withdraws from a consumer credit contract pursuant to the provisions of § 409 of this Act, the consumer may also withdraw, during the term provided for in § 409 of this Act, from a contract of sale economically linked to the consumer credit contract. The deadline for withdrawal from an economically linked contract of sale is deemed to have been observed by the consumer if the consumer has submitted the application for withdrawal before the expiry of the term.

[RT I, 31.12.2013, 1 – entry into force 13.06.2014]

(21) If the credit amount is received by the seller, the rights and obligations of the seller are transferred to the creditor in the event of the seller’s withdrawal from the contract of sale.

[RT I, 31.12.2013, 1 – entry into force 13.06.2014]

(22) In the case of withdrawal from a contract of sale, the expenses relating to the return of the thing and the related risks shall be borne by the seller. The parties may agree that the consumer bears the regular expenses relating to the return to the extent of 10 euros, except in cases where the goods delivered is not that which was ordered.

[RT I, 31.12.2013, 1 – entry into force 13.06.2014]

(23) If a consumer is not notified of the right of withdrawal, the consumer shall, in the case of withdrawal, be liable only for any damage caused to the thing intentionally or through gross negligence. The provisions of §§ 188-192 of this Act apply to other consequences of withdrawal.

[RT I, 31.12.2013, 1 – entry into force 13.06.2014]

(24) Contract terms which impede the right of withdrawal from a contract of sale economically linked to a consumer credit contract being exercised, in particular agreements pursuant to which withdrawal is bound to payment of earnest money or a contractual penalty, are void.

[RT I, 31.12.2013, 1 – entry into force 13.06.2014]

(25) In the case of a distance contract of sale or an off-premises contact of sale, the provisions of §§ 492, 493, 561 and 562 of this Act apply mutatis mutandis.

[RT I, 31.12.2013, 1 – entry into force 13.06.2014]

(3) If the seller fails to perform the obligation to deliver a thing arising from the contract of sales linked to the consumer credit contract or if the thing does not confirm to the terms and conditions of the contract and the seller illegitimately refuses to follow the legal remedies of the consumer, the consumer may refuse to perform the consumer’s obligations with respect to the creditor based on the contract of sale. If the consumer withdraws from the contract of sale, the consumer may also withdraw from the credit contract linked to the contract of sale.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(4) The provisions of subsections (1) to (3) of this section also apply to consumer credit contracts by which the performance of obligations other than the delivery of things is financed.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(5) The provisions of subsections (1) to (3) of this section do not apply to consumer credit contracts the purpose of which is to finance the acquisition of securities, foreign currency or precious metals.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

  • 4141. Specifications for ordinary cancellation of consumer credit contract for unspecified term

(1) If no period of notice has been agreed on ordinary cancellation of a consumer credit contract for unspecified term, the consumer may cancel the contract at any time without adhering to the term for advance notice. If a term of advance notice is agreed, it shall not exceed one month.

(2) Ordinary cancellation of a consumer credit contract by the creditor is permitted if such possibility is prescribed by the contract. The creditor’s declaration of cancellation shall be in a format which can be reproduced in writing and communicated to the consumer at least two months before the cancellation enters into force unless a longer period of notice has been agreed in the contract. Any declaration of cancellation which derogates from the formal requirements is void.

(3) If the right to cancel the contract is exercised with respect to the person, the cancellation not in compliance with the agreed term to the detriment of the person shall be deemed to enter into force upon expiry of the agreed term from the submission of the declaration of cancellation. If the creditor has the right to ordinary cancellation of the consumer credit contract but there is no agreement on the term of cancellation, the parties are deemed to have agreed upon the term specified in subsection (2) of this section. Failure to comply with the term of cancellation shall not render the cancellation void.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

  • 4142. Right of creditor to refuse drawdown

(1) In the case of a consumer credit contract for an unspecified term, the creditor may refuse drawdown to the consumer for good reason if this is agreed upon in the contract. Refusal is permitted in particular in the case of a significantly increased risk of the consumer being unable to fulfil the obligation to repay the credit or upon existence of circumstances which give reason to believe that the credit is drawn down for criminal purposes.

(2) In the case specified in subsection (1) of this section, the creditor shall inform the consumer of the refusal to draw down the credit and the reasons therefor on a durable medium, unless the provision of such information is prohibited or is contrary to objectives of public policy or public security. The consumer shall be notified in advance, if possible, but at the latest immediately after the refusal to draw down the credit.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

  • 415. Penalty for late payment and making of insufficient payments

(1) If a consumer delays the payments owed, any penalty for late payment demanded from the consumer shall not exceed the amount provided for in subsection 113 (1) of this Act. This does not preclude or restrict the right of the creditor to demand compensation for damage from the consumer in an amount which exceeds the penalty for late payment. Agreements which allow to claim payment of earnest money or contractual penalty from the consumer in the case of late payments are void.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(2) If, on the basis of a consumer credit contract, a consumer has made a payment which is insufficient for the performance of all obligations which have fallen due, the payment shall cover:

1) firstly, the expenses incurred for collection of the debt;

2) secondly, the principal sum owed;

3) thirdly, interest;

4) fourthly, other obligations.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(3) The provisions of subsection (2) of this section do not apply if the consumer makes payments on the basis of an execution document which is prepared as a principal claim in order to reclaim interest.

(4) A creditor shall not refuse to accept insufficient payments.

[RT I 2003, 78, 523 – entry into force 27.12.2003]

  • 416. Restrictions on cancellation of consumer credit contracts

(1) In the case where credit is repayable in tranches, the creditor may cancel the consumer credit contract due to a delay in payment by the consumer only if the consumer is wholly or partly in delay for at least three consecutive repayments and if the creditor has, without success, granted an additional term of at least two weeks to the consumer for the payment of the remaining amount together with notification that the creditor will cancel the contract upon failure to pay the tranches within the term and will claim for payment of the whole debt. The creditor’s declaration of cancellation shall be in a format which can be reproduced in writing, and upon failure to comply with such requirement the cancellation is deemed void.

(2) A creditor shall, not later than at the same time as granting a term specified in subsection (1) of this section, offer a consumer the opportunity to negotiate in order to reach an agreement.

(3) If a creditor cancels a contract, the total outstanding amount of all the payments made by the consumer for repayment of the credit and the payments made to cover the total cost of the credit shall be respectively reduced by the interest and the costs calculated for the consumer for the period when the credit is not used.

[RT I, 03.12.2012, 1 – entry into force 01.05.2013]

(4) The creditor may cancel the contract in the case the creditor was unable to correctly assess the creditworthiness of the consumer because the consumer knowingly withheld information specified in § 4034 of this Act or falsified the information submitted to the creditor. The provisions of the first sentence of subsection (1) and of subsection (2) of this section shall not apply to cancellation of consumer credit contracts according to this provision.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

  • 417. Withdrawal of creditor from consumer credit contract

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(1) If a consumer is in delay with the repayment of credit, the creditor may withdraw from the consumer credit contract the object of which is the delivery of things or performance of obligations for payment of repayments only under the conditions specified in subsection 416 (1) of this Act.

[RT I, 03.12.2012, 1 – entry into force 01.05.2013]

(2) [Repealed – RT I 2010, 77, 590 – entry into force 01.07.2011]

  • 4171. Additional notification obligation of credit intermediary

(1) A credit intermediary shall notify a consumer prior to entry into a credit intermediation contract of the following:

1) the extent of the powers of the credit intermediary, in particular whether the credit intermediary works with one or more creditors or independently;

2) the amount of the fee payable for credit intermediation, if this is paid by the consumer.

(11) In the case of residential property credit intermediation, the credit intermediary shall provide the consumer within a reasonable period of time before conducting the operations provided for in § 4011 of this Act on a durable medium with the following information:

1) the name and address of the credit intermediary;

2) the name of the register in which the credit intermediary is entered, the registration number, where applicable, and the means for verifying such registration;

3) the information on whether the credit intermediary is tied to or works exclusively for one creditor (credit agent) or more creditors and in such case the name of the creditor for which the intermediary acts as an intermediary;

4) the information on whether the credit intermediary offers advisory services;

5) the method of calculating the fee payable by the consumer for the information or credit intermediation specified in clause (1) 2) of this section, if it is impossible to indicate the amount of the fee;

6) the procedure allowing to register complaints internally about credit intermediaries which can be used by the consumer and other interested parties and, where appropriate, the means by which recourse to out-of-court complaint and redress procedures can be sought;

7) the existence and, where known, the amount of commissions or other inducements payable by the creditor or third parties to the credit intermediary for their services in relation to the credit contact.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(12) credit intermediaries who are not credit agents for the purposes of § 21 of the Creditors and Credit Intermediaries Act but who receive commission from one or more creditors shall, at the consumer’s request, provide information in the case of intermediation of credit relating to residential immovable property on the amounts of the commission payable by different creditors with whom entry into credit contracts is being offered to the consumer. The consumer shall be informed that the consumer has the right to request such information.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(13) Where a credit intermediary charges a fee to the consumer and at the same time receives commission from the creditor or a third party, the credit intermediary shall explain to the consumer in the case of intermediation of credit relating to residential immovable property whether the commission will be offset against the fee either in part or in full.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(14) A credit intermediary may announce that the credit intermediary is independent if the credit intermediary complies with the requirements provided for in subsections 51 (2) and (4) of the Creditors and Credit Intermediaries Act.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(15) If the amount of the costs specified in clause (11) 7) of this section is unknown at the time of providing the information, the credit intermediary shall inform the consumer that the actual amount of the fees will be disclosed later in the European Standardised Information Sheet.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(2) The credit intermediary shall notify the creditor of the fee payable by the consumer to the credit intermediary in such a manner that the creditor would be able to take it into account upon calculation of the annual percentage rate.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

  • 418. Requirements for credit intermediation contract

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(1) A credit intermediation contract shall be entered into in a format which can be reproduced in writing before the consumer submits an application for assuming the obligations arising from the consumer credit contract for the purposes of subsection 404 (1) of this Act.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(11) A credit intermediation contract shall set out:

1) the extent of the powers of the credit intermediary, in particular whether the credit intermediary works with one or more creditors or independently;

2) the amount of the fee payable by the consumer to the credit intermediary;

3) the fact whether the credit intermediary also agrees the fee with the creditor and the amount of such fee.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(12) Credit intermediation contracts relating to residential immovable property shall indicate the information specified in subsection 4171 (12) of this Act.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

(2) A credit intermediation contract and a credit application shall not be contained in one document.

(3) A credit intermediary shall issue a copy of a contract to the consumer.

(4) Credit intermediation contracts which do not comply with the requirements provided for in subsection (1), clauses (11) 2) or 3), subsection (12) or (2) of this section are void.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

  • 419. Commission payable to credit intermediaries

(1) A consumer shall pay commission to a credit intermediary only if the consumer is granted credit as a result of the activities of the intermediary and the consumer can no longer withdraw from the consumer credit contract pursuant to § 409 of this Act.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

(2) If credit is taken for the early payment of other credit with the knowledge of the credit intermediary, the credit intermediary has the right to receive commission only if the annual percentage rate or the initial annual percentage rate does not increase. Upon calculation of the annual percentage rate or the initial annual percentage rate for repayable credit, the possible intermediation costs for the repayable credit shall not be taken into account.

(3) With respect to services related to arranging for credit to be granted to a consumer or informing the consumer of the possibility to enter into a consumer credit contract, a credit intermediary shall not claim anything other than the commission specified in subsections (1) or (2) of this section and, with the agreement of the consumer, reimbursement of the necessary expenses incurred by the credit intermediary.

[RT I 2010, 77, 590 – entry into force 01.07.2011]

  • 4191. Provision of advisory services in case of consumer credit contracts relating to residential immovable property

(1) Advisory services means the provision of independent and personal recommendations to the consumer upon offer of a credit relating to residential immovable property in respect of one or more contracts entered into for receipt of consumer credit relating to residential immovable property.

(2) Advisory services constitute a separate activity from granting of credits and credit intermediation activities. Advising is not considered to include provision of precontractual information to the consumer for the purposes of § 4033 or provision of explanations to the consumer about consumer credit contracts for the purposes of § 4035 of this Act.

(3) In the cases not regulated by the provisions of this section, the provisions of § 51 of the Creditors and Credit Intermediaries Act and the provisions of this Act concerning authorisation agreements apply to provision of advisory services.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

  • 4192. Foreign currency consumer credit contracts relating to residential immovable property

(1) If a consumer credit contract relating to residential immovable property is not entered into in the currency of the Member State of the European Union (foreign currency) where the consumer had the permanent residence at the time of entry into the contract (national currency of the consumer), the consumer may require conversion of the consumer credit contract into the national currency of the consumer or into the currency of the Member State of the European Union where the permanent residence of the consumer currently is, if the value of the total amount payable by the consumer which remains outstanding or of the regular instalments increases by more than 20 % due to changes in the exchange rate from what it would be according to the exchange rate applicable at the time of entry into the credit contract.

(2) The parties may agree in the consumer credit contract relating to residential immovable property that the national currency of the consumer is in addition to that provided for in subsection (1) of this section or instead of it the currency in which the consumer primarily receives income or holds assets from which the credit is to be repaid, and which was determined at the time the most recent creditworthiness assessment of the consumer was made. In the case specified in the previous sentence, the consumer has the right to request recalculation of the contract into the national currency of the consumer on the terms and conditions specified in subsection (1) of this section.

(3) The exchange rate applicable to conversion is the applicable exchange rate on the day of conversion published by Eesti Pank, unless otherwise provided in the consumer credit contract relating to residential immovable property.

(4) The parties may agree in the consumer credit contract relating to residential immovable property that in addition to the right to convert provided for in subsections (1) and (2) of this section or instead of this there are other arrangements in place to limit the exchange rate risk to which the consumer is exposed under the consumer credit contract.

(5) In the case of consumer credit contracts relating to residential immovable property entered into in foreign currency, the creditor warns the consumer each month on a durable medium if the value of the total amount payable by the consumer which remains outstanding or the regular instalments increases by more than 20 per cent compared to what the total amount payable by the consumer which remains outstanding or the regular instalments would be according to the exchange rate applicable at the time of entry into the consumer credit contract in the national currency of the consumer. The warning shall inform the consumer of a rise in the total amount payable by the consumer, set out where applicable the right to convert the contract and the conditions for conversion and explain any other applicable mechanism for limiting the exchange rate risk to which the consumer is exposed.

(6) The consumer shall be informed of the opportunities provided for in subsections (1), (2) and (4) of this section in the European Standardised Information Sheet established on the basis of subsection 4033 (3) of this Act and in the consumer credit contract relating to residential immovable property.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

  • 4193. Tying of entry into consumer credit contracts relating to residential immovable property to other financial services

(1) The creditor may not make the entry into a consumer credit contract relating to residential immovable property dependant on entry into a contract for provision of another financial service in such a manner that separate entry into a consumer credit contract relating to residential immovable property is impossible. The provisions in the previous sentence do not include offers of consumer credit contracts relating to residential immovable property together with contracts for provision of other financial services if the consumer credit contract relating to residential immovable property can be also entered into separately but on the same terms and conditions as together with entry into any other contact.

(2) Regardless of the provisions of subsection (1) of this section, the creditor may make entry into a consumer credit contract relating to residential immovable property dependant on the obligation of the consumer to:

1) enter into a contract for opening a payment or savings account where the only purpose of the account held on the basis of this contract is to accumulate capital for the performance of the obligations arising from the consumer credit contract relating to residential immovable property, or to pool resources to obtain the credit, or to provide additional security for the creditor in the event of default by the consumer, or

2) enter into a contract for provision of investment services or, in the case such a contract has already been entered into, to continue the performance thereof where it provides additional security for the creditor in the event of default or if the purpose thereof is to accumulate capital to perform the obligations arising from the consumer credit contract relating to residential immovable property or to pool resources to obtain the credit.

(3) If the entry into a consumer credit contract relating to residential immovable property is made dependant on entry into an insurance contract, the provisions of § 4012 of this Act apply.

(4) The creditor may make entry into a consumer credit contract relating to residential immovable property dependant on entry into another contract if the creditor is able to demonstrate to the competent authorities that bundled contracts or categories of contracts offered on the same terms and conditions which are not available separately are clearly beneficial for the consumer, taking due account of the availability of these contracts on the market and the fee paid on the basis thereof.

(5) The contract on the entry into which the entry into the consumer credit contract relating to residential immovable property is made dependant is void if the prohibition provided for in subsection (1) of this section was violated. The consumer credit contract relating to residential immovable property shall continue under the hitherto terms and conditions.

[RT I, 11.03.2016, 1 – entry into force 21.03.2016]

  • 420. Prohibition on violation of provisions

A person or institution provided by law may, pursuant to the procedure provided by law, require a creditor and credit intermediary who has violated the provisions provided in this Division to terminate such violation and refrain from future violation.

[RT I, 31.12.2013, 1 – entry into force 13.06.2014]

  • 421. Mandatory nature of provisions

Agreements which derogate from the provisions of this Division to the detriment of the consumer are void. The provisions of this Division also apply if an attempt is made to avoid application of the provisions by different wording of agreements, in particular upon division of the credit amount between several contracts.