Federal Court of Justice overturns loan fees for building society savings contracts

There are approximately 30 million building society savings contracts in Germany. The recent ruling by the Federal Court of Justice (BGH) is therefore likely to have a significant impact. The judges ruled on the legality of loan fees. While these fees have already been abolished in most new contracts, they can still be found in many older ones.

Undue discrimination

Loan fees are a one-time payment that building society savers must pay when they take out the loan. In this particular case, the North Rhine-Westphalia Consumer Center sued the Schwäbisch Hall building society because a clause stipulated a loan fee of 2% of the loan amount. The Federal Court of Justice (BGH) has now declared such fees inadmissible. Such clauses unfairly disadvantage building society customers.

Observe the limitation periods

Customers can reclaim processing fees already paid, according to the Federal Court of Justice (BGH) ruling, provided the claims for reimbursement have not yet expired. This is the case if the contract was paid out in 2013 or later. Those who had their contracts paid out in 2013 must take action this year. If the affected building society savers are still in the savings phase, they do not have to pay the fee – regardless of whether it is stipulated in the contract. (mh)

Federal Court of Justice (BGH), Judgment of November 8, 2016, Case No.: XI ZR 552/15

Source: ImmoCompact BfVI