Fixed interest period
In banking, the fixed interest period is the period for which the fixed interest rate agreed in the loan agreement is agreed ( fixed interest loan ) without current market interest rate changes affecting the agreed interest rate. The term is used for loans with a total term that exceeds the fixed interest period. After the fixed interest period has expired, a new interest rate agreement must be made.
General
The purpose of agreeing interest rates that should remain unchanged during a certain interest period is to offer the borrower a secure basis for calculation and to partially relieve him of the interest rate risk caused by market fluctuations . If the comparable market interest rates rise during the fixed interest period, the loans benefiting from the fixed interest rate are not affected by this; On the other hand, however, the borrower does not benefit from falling market interest rates, but must continue to pay the higher fixed interest rate.
species
The lending system has fixed interest periods both in the lending business with companies and in consumer loans.
Loans to companies
In the case of loans to companies, fixed interest periods usually start at one month. Terms of 3, 6 or 12 months are also common. It can be agreed that after these fixed interest periods have expired, the borrower will be given the option to repay the loan in whole or in part or to agree a new fixed interest period ( "rollover" ). Such fixed interest rate agreements are usually based on the international standards of the LMA , according to which unused parts of a revolving facility ("rollover facility") within the availability period ("availability period") up to the due date ("final maturity date") of the credit line may be used. The existing lending obligation then does not end on the date of a periodic interest rate adjustment , but on the due date of the superordinate loan approval within which revolving claims are possible.
Corresponding loan agreements therefore have a longer term than the fixed interest periods to be agreed within these agreements. If there is a new fixed interest period after a fixed interest period has expired, a periodic interest rate adjustment (usually every 1, 3, 6 or 12 months at fixed dates) based on a precisely defined reference rate (e.g. EURIBOR , LIBOR ) is contractually agreed. The loan interest is then made up of two components, namely the agreed reference interest rate plus a firmly agreed mark-up (margin).
Consumer credit
Here, too, the fixed interest periods can be of different lengths. Terms of 5, 10 or 15 years are usual for real estate financing . The longer the fixed interest rate on a so-called mortgage loan, the higher the agreed interest rate is usually - with a normal interest rate structure. After the fixed interest period has expired, follow-up financing must be negotiated.
During the fixed interest period, a loan termination by the borrower is generally excluded in accordance with Section 489 of the German Civil Code . Only in the case of a fixed interest period that exceeds a period of ten years, termination can be given after ten years with a six-month notice period in accordance with Section 489 (1) no. 3 BGB. In the case of consumer loan contracts, if the loan is not secured by a real estate or ship lien, the borrower may terminate a termination after six months after receiving the loan in full with a three-month notice period despite the fixed interest rate pursuant to Section 489 (1) No. 2 BGB.
In principle, credit institutions are not obliged to take back loans secured by real estate before the fixed interest period has expired. In justified individual cases, however, credit institutions must agree to an early withdrawal. In real estate financing, banks are obliged to allow early repayment of the loan through the purchase price when the financed property is sold - even during the fixed interest period. In the cited judgment, the Federal Court of Justice wants the property owner to have the “economic ability to act” so that private reasons (such as divorce, illness, unemployment, over-indebtedness, relocation) and the perception of a favorable sales opportunity are sufficient for a reason. In principle, the borrower is entitled to early redemption of a real estate loan if this is necessary for an (intended) sale of property. Special statements on the necessity of the redemption are in any case not normally necessary, since it is common practice that the provision of unencumbered property is agreed in a real estate purchase agreement. However, credit institutions have the right to demand early repayment penalty .
Individual evidence
- ↑ Tony Rhodes, Mark Campbell, Clare Dawson, Syndicated Lending, Practice and Documentation , 2004, p. 284
- ↑ Ulrich Seubert, Martin Weber : 5, 10, or 15: Maturity Choice of Private Mortgage Borrowers , Working Paper, University of Mannheim (English)
- ^ BGH WM 1997, 1747, 1748
- ↑ BGHZ 136, 161, 166 f.
- ↑ BGH WM 2004, 780, 781