How to request a decrease to your instant loan-related expenses

Who are these instructions intended for?
What you can demand
2.1. Moderation of credit expenses
2.2. Cancellation of credit expenses
Instructions for the submitting requests and the related expenses
3.1. You have received a summons from a district court
3.2. A district court has given a default judgement
3.3. A district court has given a judgment
3.4. The credit is being paid off or you have only received a collection letter from the debt collection agency
3.5. Expenses related to the contestation of the matter in court
Where can I find assistance?
4.1. Public legal aid offices
4.2. Private attorney
4.3. Request for assistance to the Consumer Ombudsman

1. Who are these instructions intended for?

These instructions apply to consumer debtors, who have a credit agreement with an effective interest rate of more than 50% and whose agreement has been concluded prior to 1 September 2019.

Regulation concerning the credit expenses of consumer credits have changed as of 1 September 2019, so that regardless of the amount of credit one has, the annual nominal interest they pay can be no more than 20 per cent. However, this stricter regulation of expenses does not apply to credit agreements entered into prior to 1 September 2019.

These instructions are based on legislation and recommendations for the resolution applying to instant credit matters issued by courts and the Consumer Disputes Board. However, the instructions do not necessarily apply to all situations, and the Consumer Ombudsman cannot guarantee that courts will in all cases reach the conclusion demanded by the consumer.

2. What you can demand

Depending on your situation you can demand your credit costs to be moderated, which would decrease your credit expenses. In some situations, you may be able to demand the credit costs to be cancelled entirely, in which case you would only be required to repay the capital you have drawn.

2.1. Moderation of credit expenses

You can demand that you are not obligated to pay more than 50% of the real annual interest in credit costs. This is based on resolution practice that has been established in district courts and the Consumer Disputes Board due to preliminary ruling KKO 2015:60 by the Finnish Supreme Court (Decisions by the Consumer Disputes Board in Finnish), (see KKO 2015:60).

You can check the effective interest rate reported by a creditor

from the creditor’s online service
OR
the credit agreement that the creditor has sent to your email address and/or the Standard European Consumer Credit Information form.

2.2. Cancellation of credit expenses

If, in addition to unreasonable credit expenses, the conditions for credit expenses have been reported unclearly in marketing materials or in credit documents, you can demand for the complete cancellation of credit expenses.

Credit documents include the Standard European Consumer Credit Information form, a credit agreement and the general terms and conditions for credit.

For example, the following ambiguously stated conditions have been observed in the credit documents of instant credit companies:

the nominal interest rate has been reported as a monthly interest or otherwise incorrectly
the amount for the effective annual interest rate or withdrawal fee are not included in the credit documents or they have been reported incorrectly
the total expenses have not been described with examples that illustrate the typical use of credit

When assessing the clarity of conditions, it is important to determine whether the creditor has provided advance information on the credit in a permanent format well before entering into the credit agreement in the manner provided by the Consumer Protection Act for example by email (chapter 6 a. section 11 and chapter 7, section 9 of the Consumer Protection Act).

No interest or payments can be charged from the consumer of these have not been specified in the credit agreement or the credit agreement has not been sent to the consumer in a permanent format (chapter 7, section 17 of the Consumer Protection Act, and KKO 2016:73 sections 33 and 34).

The current stage of the debt case will affect the form in which and the deadline by which you can submit requests for a decrease in credit expenses.

If you have been taken to court due to your debt, select one of the options 3.1 – 3.3. If you want to request a decrease to credit expenses even though you have been able to pay them in accordance with your credit agreement, see section 3.4.

Also read section 3.5., Expenses related to the contestation of the matter.

3.1. You have received a summons from a district court

From the time you are informed of the summons, you have 14 days to respond.

The receipt will happen on the day you as the summoned defendant mark down on the summons’ certificate of receipt. The bailiff can also deliver the information by telephone, after which the bailiff will send the documents to you by email or mail. In this case, receipt has taken place during the phone call. Please phone the district court to confirm the date of receipt and deadline.

Your response must include a demand for the moderation of credit expenses and list the specific items which are unclear in agreement documents. The response must also include the register number for the case, which is listed on the top right corner of the summons. The register number is always in the format E19/xxxx.

If you send your response by mail, it must be delivered at latest on the respond-by date. The contact information for the district court will be listed on the petition.
The district court can upon request grant additional time for submitting a response. You can make the request by telephoning the district court. You must request additional time after receiving word of the summons but before the actual response time has come to an end. If the certificate of receipt is returned to the district court by mail, the debtor should request additional time a few days after send the certificate, so that the district court is aware of the date of receipt.

After receiving a summons , it is recommended that you contact the legal aid office or a private attorney as quickly as possible, so they can assist you in responding to the summons. Read more in section 4.

If you do not respond to the summons by the deadline, the district court can give a default judgement in favour of the plaintiff without investigating the matter.

3.2. A district court has given a default judgement

A default judgement is generally issued due to the inaction of the defendant, i.e. when you have failed to respond by a given deadline.

If the district court has issued a default debt-collection judgement, you can still appeal the this via the recovery procedure.

After the deadline for issuing a default judgement has come and gone, there are no other legal deadlines in place, and the district court does not separately notify you of the issuance of a default judgement. If you are unaware of a deadline or the stage of a case, you can contact the district court and ask for this information.

You must submit an application for recovery within 30 days of the verifiable notice of a default judgement.

A verifiable notice means that you have acknowledged your receipt of the default judgement with the enforcement authority or bailiff, or by signing a certificate of receipt delivered by mail.
If no verifiable notice has been provided for a default judgement for example during your visit to an enforcement authority, the 30 day time period for submitting an application for recovery does not begin.
If there is any ambiguity in the matter, you can ask the enforcement agency within the jurisdiction in which you reside, whether you have verifiably received word of a default judgement.

Your recovery application must include a demand for the moderation of credit expenses and list the specific items which are unclear in agreement documents. The recovery application must also include the register number for the case, which is listed on the top right corner of the summons. The register number is always in the format E19/xxxx.

If you send your application for recovery by mail, it must be delivered at latest on the return by date. The contact information for the district court will be listed on the summons.

After receiving a default judgement, it is recommended that you contact the legal aid office or a private attorney as quickly as possible, so they can assist you in submitting an application for recovery. Read more in section 4.

If you do not apply for recovery within the given deadline, the default judgement will be final, and it can no longer be appealed.

3.3. A district court has given a judgment

A decision issued by a court is called a judgement if you have responded to a debt collection action. Phone the district court to find out the date on which a judgement has been given and the deadline for an appeal.

If you wish to submit an appeal to a judgement, you must file a declaration of intent to appeal within 7 days and submit an appeal within 30 days of the date on which the judgement was given. A declaration of intent to appeal will be filed with the district court that gave the judgement.

The form for filing a declaration of intent to appeal is available on the judicial system’s website. The notification can also be submitted without using the form.

If you send the form filing for a declaration of intent to appeal by mail, the form must be delivered no later than 7 days after the judgement has been given. The contact information for the district court, which must be included on the form, will be listed on the summons.

If you do not file for a leave of continued consideration or appeal within the aforementioned time period, the judgement will be final after this time and no appeals can be submitted.

3.4. The credit is being paid off or you have only received a collection letter from the debt collection agency

You can dispute unreasonable demands made by the creditor also before the collection of the debt has been brought to a court. In other words, you can appeal credit expenses even if the credit’s payments have been made on time or you have received letters from the debt collection agency.

You can send the creditor a complaint including a demand for the moderation of the credit expenses required by the creditor or debt collection agency at least as far as the effective annual interest exceeds 50 per cent.

You can check their credit’s effective interest rate from

the creditor’s online service
OR
the credit agreement that the creditor has sent to your email address and/or the Standard European Consumer Credit Information form.

You can use the attached complaint template when submitting a complaint. You may also use this template for submitting a claim for the moderation of credit expenses on the basis of their unreasonable quantity. You can also demand the moderation of credit expenses on the basis of other grounds or even their complete cancellation if, for example, the grounds listed in section 2.2 are met.

Complaint template
Word-template (fill in on computer and print)

If the complaint does not produce the desired result, you can contact Consumer Advisory Services by telephone or with an electronic contact form.
Contact Consumer Advisory Services

If the matter is not resolved with the help of the consumer advice, you can take the matter to Consumer Disputes Board, which will issue a recommendation for a resolution. The Consumer Disputes Board can require that you first contact Consumer Advisory Services before it processes a recommendation for resolution. The processing of the matter by the Consumer Disputes Board is free of charge for the involved parties.

The contestation of a matter in a court includes the risk of expenses.

The principle rule for court proceedings concerning disputes is that the losing party will cover both their own as well as the opposing party’s legal expenses. If some of the demands are resolved in favour of the defendants (in these cases this is most often the debtor) and some in favour of the plaintiff (in these cases this is most often the creditor), both parties will, as a rule, cover their own legal expenses.

4. Where can I find assistance?

You can ask for assistance from the following places for handling court proceedings

4.1. Public legal aid offices

Public legal aid is a State-provided legal service for persons whose financial status means they are unable to cover legal expenses. Legal aid means that a citizen can be provided the services of a State-paid Public Legal Aid Attorney to help them with legal matters either completely free of charge or with a partial contribution on their part. Legal aid covers all legal matters.

However, legal aid is usually not granted if the applicant has legal expenses insurance that covers the matter at hand. Whether legal aid is granted completely expense-free, partially free or not at all depends on an income and expense report on the applicant.

Read more on legal aid and who it is provided to.

4.2. Private attorney

You can hire a private attorney or lawyer to handle the matter. If you have legal expenses insurance, ask your insurance provider if your policy will cover the expenses of the trial in question. Legal expenses insurance is usually a part of a home insurance policy or a trade union’s insurance policy.

4.3. Request for assistance to the Consumer Ombudsman

The Consumer Ombudsman can assist consumers with individual disputes if this assistance can be considered important with regard to the general interest of consumers.

If the Consumer Ombudsman decides to assist a consumer, the Consumer Ombudsman can bear liability for the expense risk in the matter. You can submit a request for assistance to the Consumer Ombudsman via an electronic form, by emailing them at kirjaamo@kkv.fi or sending the request by mail to the Competition and Consumer Authority, PL 5, 00531 Helsinki.

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