In which cases can revolving credit be suspended, preventing any use of the available money? A suspended revolving credit generally indicates that the lending institution has not received in time all the guarantees and information necessary to renew the contract.
This does not prevent him from withdrawing the remaining monthly payments. Reminder of the rules surrounding this small loan and solutions to lift its suspension.
Revolving credit, a very supervised loan
Revolving credit is a very practical but relatively expensive small credit, whose revisable APR rate indicates that it can change. This loan is automatically renewed every year, after the lender has sent a letter reminding all the conditions . A suspended revolving credit agreement is often the result of missing information, or a new inconclusive verification of the borrower’s repayment capacity.
Revolving credit suspended: the reasons
The law is very precise with regard to revolving credit, a small loan whose revisable APR rate is not always easy to understand. Here are the main laws relating to the renewal of a revolving credit agreement:
- The contract is tacitly renewed each year . The lender is however required to send a letter reminding all the conditions three months before the anniversary date. The borrower can then decide not to renew the contract. A new credit with card associated with the contract is then impossible.
- In the case of a credit unused for one year, the lender is obliged to send the summary of all the credit conditions at the latest three months before its anniversary date. a revolving credit unused for one year.
- The lender must recheck the credit worthiness of the applicant every three years . A less favorable situation may cause the credit to be suspended.
- The lender can refuse changes to a credit, subject to appearing at least 20 days before its renewal date. In this case, use the cancellation slip, sent by the lender with its newsletter. Revolving credit is then transformed into a conventional loan.
- It is possible to terminate a revolving credit agreement at any time. The reserve of money used must then be reimbursed according to the terms of the credit. The reimbursement of the last monthly payment puts an end to the contract.
How to lift the suspension?
A suspended loan can be opened again for a year, only at the request of the borrower. In this case, the lender must check the creditworthiness of the borrower. You must contact the customer service of the body managing the contract to process the request or send a registered letter to request a reopening of the revolving credit suspended. Once the contract is active again, the money reserve will become usable again..