At the beginning of the pandemic, the Austrian federal government implemented a ten-month credit moratorium. This means that debtors did not have to repay their loan installments if they had payment difficulties due to the pandemic, for example because they lost their job.
VKI, AK and debt counseling also help
Since these deferrals expired in January 2021, however, numerous consumers have continued to have problems paying their loan installments, according to lawyer Beate Blaschek, head of consumer policy and financial services at the Ministry of Social Affairs. According to Blaschek, the Association for Consumer Information (VKI), the Chamber of Labor (AK) and the debt counseling service have helped those affected over the past year. At the same time, however, more and more consumers turned directly to the Ministry of Social Affairs.
The National Council therefore decided in December to set up its own service point within the ministry: exclusively for problems with late payment by private individuals – for consumer credit, leasing contracts, overdrafts and installment payments after a purchase. With the aim of coming to particularly quick, amicable solutions with the banks through this specialization.
In addition to repayment, there are also default costs
According to Blaschek, the most common problem consumers come to the service point with is unemployment, sometimes short-time work. There are women who are the only breadwinners who are running out of money and cannot service an existing loan. In such cases, banks would have the right to call in the loan, which would mean that the entire outstanding loan amount would have to be repaid at once, including all default costs.
“This is a serious threat for people who cannot even afford to pay back the installments at the moment,” says the lawyer. There could then either be a garnishment of wages or a garnishment of chattels would be initiated. “So it’s possible that the bailiff will come and actually seize things here,” says Blaschek.
Encourage banks to ease payments
In order to prevent such developments, the three responsible lawyers at the ministry take a close look at the loan agreements and also check whether the amount of the default costs demanded is in line with the law. Then Blaschek and her team try to get the banks to ease their payments.
One argues with the banks that the people in this situation can no longer afford because they have gotten into financial difficulties through no fault of their own as a result of government measures such as the closure of various companies, according to Blaschek.
Efforts are therefore being made to propose measures such as reducing the rate for a longer period of time, temporarily deferring a rate, or even rescheduling the loan. “There have already been a few successful placements, but you can’t really talk about a quota there,” says Blaschek. Serious figures can only be given after a longer observation period.
AK and VKI welcome support
From the point of view of the AK, the ministry’s ombudsman’s office does not offer any new services for consumers, according to a written statement to help.ORF.at. Both the VKI and the AK would already offer good support for borrowers in payment difficulties. However, according to the AK, there is nothing to object to about an additional position.
Contact the new ombudsman
The new service point opened last week. Its official name is “Loan Payment Problems Ombudsman”. Reachable by email at [email protected] The demand is high, according to Blaschek, 40 inquiries have already been processed in the first week of the year alone.
She advises contacting the ombudsman as soon as you get the first negative response from the bank that it is not ready for a settlement. In the first e-mail to the service point, it would be good to briefly describe the situation: how long the loan has been running and why it cannot be serviced, says Blaschek. The ombudsman would then respond and request the necessary documentation, which could then either be sent by post or scanned and emailed.