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Interest

Interest gains on interest rate limitations

This article was translated by an automatic translation system, and was therefore not reviewed by people.


 


Capitalized interest, or interest on interest "as they are better known, can not be charged by banks in financing real estate contracts by the Housing Finance System (SFH). The decision, published by the Superior Court of Justice (STJ) in the last 18 days, can benefit the estimated 10 million borrowers across the country, these - 1 million of whom have disputed this type of charge in court.
According to estimates of experts, the economy such persons could reach 20% of the total in a 20-year contract - the equivalent of 4 years of payment of installments. The exception is the new financing agreements signed from July this year when she went into effect a law that authorized the charging of interest capitalized as part of the My House, My Life, the federal government.

"This agreement creates an orientation-law, which shall be applied in adjudicating cases of a similar nature in the courts of first and second instance in Brazil," explains the managing director of the Brazilian Association of Housing Borrowers (ABMH), Lucio Delfino . "This argument only reinforces the arguments that have always contended, that the capitalization of interest is excessive," said counsel for the National Association of Borrowers (ANM), Carlos Alberto de Santana, who signed a demonstration during the STJ.

Price Table

The decision, however, states that it is not to the court to evaluate whether or not the effect of compound interest in financing contracts signed under the application of the Price Table. Although the entities of consumer protection claim that this system involves the capitalization of interest, the issue is disputed by financial institutions and target of controversy even among mathematicians and financial experts.

This does not, however, that each borrower, particularly among the courts to challenge the effect of compound interest in its financing. "In this case, the consumer who is aggrieved may bring a lawsuit to evaluate their contract, seeking a pronouncement in favor of lower courts and tribunals," advises Delfino.

Borrowers who already have processes in place in the courts should be alert. If the action already ask that of Table Price and capitalized interest, there is no need to initiate a new order. It is also worth remembering that the rule excludes funding agreements not covered in the SFH.

The president of the ANM-PR, Luiz Alberto Copetti means that borrowers who have paid off the property may also require actions designed to recover the amount paid in interest capitalized during the funding. "For it is important to seek help from a lawyer who knows the subject for an evaluation of the contract. Administratively the possibility of achieving this is practically nil. The borrower should seek a court, "directs.

Limit interest

If, on the one hand, the decision from the Supreme Court to ban the interest favored borrowers, another understanding of the court appealed to financial institutions. Since there was no formal definition, the limit for the rate of interest on mortgages was also the subject of disputes in court. Some judges felt that this rate was limited to 10% for contracts signed by July 1993. Other judges who could be bored up to 12% per year. The organizations that protect borrowers asked to limit the interest repayments at its lowest. But the STJ kept the limit of 12% per year, regardless of the date of signing the contract.

Service

The incidence of "interest on interest" may be challenged in court. There are associations that can assist in analyzing the financing contract. Through them you can check whether you can be benefited from the recent decision of the Court.

Brazilian Association of Housing Borrowers - ABMH

www.abmh.org Phone: (41) 3222-1100

National Association of Borrowers Paraná - ANM-PR

www.anm.com.br Phone: (41) 3077-5504

Knowledgebase
The court decision may affect up to 10 million borrowers. Check out some answers on the subject:

What changed?

The Superior Court of Justice banned the charging of interest capitalized in housing finance contracts by the Housing Finance System (SFH) at any frequency.

Who will benefit?

About 10 million borrowers with contracts signed before July 2009, especially those who have the Table Price as a system of depreciation.

What must I do to benefit from the decision?

Seek help from an attorney or an association of borrowers to evaluate their contract. You must go to court to reverse the charge.

There is a difference of actions for those who signed a contract with the CEF?

Yes, in case of contracts with the Federal Savings of up to 60 minimum wages (or R$ 27.9 thousand) the borrower must look for the Special Federal Court. Above this, the Federal Court policy should be thrown.

E when the financing is through another financial institution?

In contracts with private banks or state of up to 40 minimum wages (or R$ 18.6 thousand), the borrower may appeal both the Special Court as the civil courts. Up to 40 minimum wages, only courts will accept the process forward.



Source: Gazeta do Povo

This article was translated by an automatic translation system, and was therefore not reviewed by people.

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