LM Legal Services Blog

According to a research carried out by Sega daily newspaper, some Bulgarian banks continue to charge a penalty fee in the cases of early repayment of customers’ loans, although the amendments to the Law for the Customer Loan have come into effect from 5 January 2009. According to the amendments, banks should not collect a penalty fee if loans ranging from 400 to 40 000 levs are repaid before the maturity date.

According to First Investment Bank, they still collect penalty fee because it is not clear if the amendment will affect old loans or will be valid only for new loans. UniCredit, UBB and Piraeus Bank said that they still did not have internal instructions and at the moment they collect the penalty clause as per the contracts signed with their clients. Allianz Bank declared that they continue to charge a penalty fee of 5% of the total amount if the customer pays in one go less than 6 instalments but if they pay more instalments at once, there is no penalty fee.