Abusive interest: find out what the maximum rate permitted by law is 

Dealing with excessive interest rates can be a real headache.

That's because paying excessive fees can lead to serious financial problems, as well as reduce purchasing power.

But what exactly are abusive interest rates? How can they be identified? What should be done?

If you are going through this situation, today's material was produced to help you.

So, if you want to know everything about abusive fees and what to do in these circumstances, stay with us!

What constitutes excessive interest rates?

Before anything else, it's important to understand what excessive interest rates are.

This is because it's common to see cases where people find themselves paying high fees due to late payments.

But is that all that defines excessive interest rates?

The answer to this question is: it depends!

It's very common for someone to have a problem and end up not being able to pay their credit card bill on time.

Therefore, in a short time, an invoice of R$ 800.00 can end up being R$ 2,000.00, or even more.

It is commonly believed that this practice is abusive; after all, how can a simple delay double or even triple the amount of the debt?

And that's not entirely wrong, but we need to understand that the concept of "abusive" considers two main points.

The first of these concerns the signed contract, that is, the clauses contained therein.

It is common to include the following in the contract: interest rates applied in each case.

And when the customer signs, it is understood that they agree to those terms, therefore they were not caught off guard by the fees.

The second point, however, could lead to the contract being voided, as it pertains to current legislation regarding interest charges.

This means that the contract clauses must comply with the country's legislation.

Therefore, if one credit card contract, For example, if a policy stipulates charging interest rates higher than those permitted by law, this could be considered abusive.

It's worth mentioning that cases where interest rates are jeopardizing the ability to pay can also be interpreted as abusive.

Therefore, it becomes easy to understand that abusive interest rates are those that are inconsistent with the law, and, ultimately, those that are higher than stipulated in the contract or that hinder negotiation. 

Where it is common to find excessive interest rates. 

By now we should understand what excessive interest rates are.

In our explanation, we gave the example of a credit card bill, which is the most common case.

However, it's worth mentioning that this is not an isolated case, and that abusive charges can be found in other types of contracts.

A very common occasion is in the case of financing long-term, for the purchase of cars and real estate.

Due to the long-term nature of the contract, financial institutions often include high interest rates in the agreement.

These interest rates can cause a financing contract of R$ 60,000.00, payable in 24 installments, to end up costing R$ 120,000.00, or even more.

However, it's important to point out that simply having a high interest rate doesn't define it as excessive, because, as we've seen, that depends on the legislation.

Therefore, it's important that you keep an eye on the rates published by the Central Bank.

These rates will help you understand if the interest rates on your contract are too high.

Therefore, it's understandable that excessive interest rates can be found in absolutely any transaction involving payment in installments or late payments.

What determines whether this charge is absurd is precisely that it does not fall within the parameters permitted by law.

Therefore, it's important that you keep an eye on any type of contract in order to avoid abusive payments.

What are the legally permitted interest rates?

By now we should have understood what abusive interest rates are and in which cases they can occur.

That being said, the only thing missing was specifying which interest rates are permitted by law.

And the first thing we should clarify is that there is currently no maximum percentage.

Therefore, the determination of legally permitted interest rates is left to the discretion of the market average published by the Central Bank.

Furthermore, this rate varies depending on the type of contract.

Therefore, loan rates are different from late payment interest rates.

To help you understand better, let's look at an example.

Let's assume that the interest rate for personal loans at the Central Bank varies from 8.5% per year to 12% per year.

This indicates that a personal loan agreement For example, charging interest of 20% per year may be considered abusive.

This is because the rate applied is above the market rate, deviating from the Central Bank's benchmark.

This measure aims to prevent banks from charging exorbitant fees that compromise customers' income and ability to pay.

Therefore, it is clear that the interpretation of abusive interest rates depends on the analysis of indices published by the Central Bank.

Therefore, when reviewing your contract, you should pay close attention to the rates advertised for this type of transaction.

Therefore, the determination of excessive interest rates is made in a particular way, considering each case specifically.

How to avoid excessive interest rates? 

Understanding what constitutes excessive interest rates is the first step in avoiding the problem.

That's because, if you complain about interest rates that are within the legal limits, unfortunately there's no room for resolving the problem.

Therefore, in addition to understanding what it is, it is also essential to know how to avoid this type of charge.

Therefore, let's now look at 3 tips that will help you avoid falling into abusive contracts.

Read the contract carefully. 

Unfortunately, not reading the contract carefully is what causes many people to end up signing and agreeing to high charges.

As we said, if these charges are stipulated in the contract and are not significantly outside the market average, the finance company can appeal, as it does not necessarily constitute an abusive charge.

Therefore, reading the contract is the first step to avoid falling into abusive interest rates.

Stay informed about central bank rates. 

In addition to reading the contract, it's important that you keep an eye on the Central Bank's interest rate index for your type of contract.

This will help you understand if the fees charged are in line with the index.

This way, you avoid falling into contracts that are out of compliance and have above-average charges, which ultimately result in excessive interest rates.

Get quotes from more than one company.

Finally, in addition to knowing the market average, it's crucial that you get more than one quote.

This will help you get lower rates, since interest rates vary depending on the institution.

The Central Bank's index shows which banks charge the lowest and highest rates.

Therefore, getting a quote can help you secure a more advantageous contract and avoid excessive interest rates! 

I'm paying excessive interest rates, what should I do? 

Avoiding them isn't always possible, as it's common to sign contracts without knowing about the possibility of excessive interest rates.

In this case, what can be done? How can it be resolved? 

The first thing you need to do is look for concrete information that determines whether the charge is abusive.

For this, the assistance of specialized professionals can be beneficial.

After discovering this, you should contact the financial institution to request an explanation regarding the excess interest.

In these cases, it's common to be able to negotiate, since many companies are aware that this type of charge is not allowed.

However, if there is no negotiation, and the company insists on charging, it will be necessary to file a lawsuit.

This action aims to legally clarify the abusive charge, as well as request its cancellation and the return of any amounts unduly paid, if applicable.

The process makes it possible to establish the existence of the problem, and resolving the case may require legal measures to eliminate the harm.

Therefore, if your contract is not in accordance with your contract terms, it's worth pursuing your rights to resolve the problem.

This way, you ensure the health of your financial life and avoid being held hostage by abusive contracts!