Maintaining responsible lending practices is a requirement for any company or financial institution offering loans of any kind to individuals or other companies.
The lender of money increases their own risk if they do not implement or comply with government lending regulations, and as recently as the past year, there are new regulations in the micro-lending loans market sector.
The individual who wants to borrow money from any institution, especially for a secured loan, has more negotiating power today than ever before.
This is a huge shift in the middle class financial status, as it was generally only the reasonably wealthy who had that kind of power in the past.
The world recession seems to have levelled the ‘playing field’ so to speak, and because the demand for loans has increased exponentially, so too has the need for flexibility and negotiation.
The cornerstone of lending agreements is that they involve two parties: a lender and a borrower.
It is no longer a ‘take-it-or-leave-it’ scenario when a loan is on offer to a consumer.
The consumer can far more easily verify his rights through organisations like Citizens Advice (www.citizensadvice.org.uk).
The Consumer Credit Act also spells out what an institution is allowed to do or not allowed to do, and the consumer becomes an equal ’partner’ in the two-way agreement between him and the lending institution.
There has been so much in the way of development of fair and equitable practices in the industry of lending money, to assist, as far as possible, people who have lent money, to be able to repay it.
This may require a payment holiday, which affords the consumer an opportunity to put the repayments on a loan on ice for a month, to catch up with life, and then resume repayments without being pursued for the debt as may have happened in the past.
In the lending term of most long term loans, such as mortgages, people will experience life events that will put their ability to repay their loans without any problems under pressure.
No-one wants the threat of having their home repossessed hanging over their heads, especially when they have a family or even possibly extended family to take care of.
A home is an asset, after all, and very possibly a legacy to leave to one’s children. It’s the place a family was forged and it becomes far more than just bricks and mortar to the occupants over time.
It is advisable to anyone paying off debt to educate themselves about their rights and their obligations, and to ensure that all agreements meet the requirements of the lending industry and consumer protection facilities.
Access to this information has been made so simple on the internet that it takes a mere search engine search to source the information and even get it spelled out in simple layman’s terms.
Take charge of your financial well-being and ensure a better future for those dear to you.