Overcrediting

Is there overcrediting?

Banks (and other lenders) may not give you unlimited credit. They may grant you credit only if you can bear the burden associated with that credit. If you apply for a credit and the amount of this credit exceeds your ability to bear, the bank may not give you this credit.

Therefore, if you apply to a bank (or other lender) for a loan, the bank must investigate your financial standing. For this investigation, the bank must identify various data. These include the amount of your income, the amount of your housing costs and the amount of obligations from any other loans you may have in your name. If the investigation shows that you have applied for more credit than your carrying capacity allows, the bank may therefore not grant this credit to you.

Unfortunately, nevertheless, there have been many instances in the past when banks have extended more credit to consumers than was allowed. This is referred to as over-indebtedness (or over-lending). Overcrediting often results in the borrower getting into financial trouble.

"Overcrediting can be the result of the bank's failure to investigate the consumer's ability to pay at all, failure to conduct that investigation properly, or simply not caring about the results of the investigation."

Am I entitled to compensation for over-indebtedness?

In principle, if a consumer has (been) over-indebted, they are entitled to compensation. How high this compensation is depends on what exactly occurred.

If a consumer suspects that they are (or have been) over-indebted, it is important that they take action as soon as possible. Doing nothing for too long may result in the consumer no longer being able to claim compensation for his losses.

What happens to the BKR registration?

If the bank grants you a credit, this is registered with the BKR. If it turns out that the bank should never have granted you the registered credit, this may also have consequences for the registration of the credit. The consequences depend on what exactly happened. In general, the registration will have to be positively adjusted, and in many cases even the entire BKR registration (or codes) will have to be removed. In that case, the blockage is lifted to, for example, borrow money responsibly or take out a mortgage.

Contact us in case of (possible) overcrediting

Do you think (or are you sure) that you are currently over-indebted, or have been over-indebted in the past? Then request a no-obligation consultation to discuss over-indebtedness. We will then assess whether and in what way we can assist you.