Information overload effect in housing loans to consumers
This paper analyses one of the basic consumer's rights in the Union – the right to be informed, and in the context of the new regulation on housing loans – Directive 2014/17. With its content, Directive 2014/17 regulates key issues of housing (mortgage) lending, and in particular: the consumer's right to be informed, credit risk management, foreign currency lending and uniform rules of calculating the effective interest rate. As a light motive of the Directive, the consumer's right to be informed is pointed out in different stages of the credit relations. At the same time, critics of the Directive are in particular focused on the so-called information overload effect. To that extent, this paper seeks to examine the consequences of the „too-informed“ consumers, and risk in decision-making in credit relations based on the quantity of information provided. Using normative method, the author tries to show the consumer the right to be informed in a broader sense: analyzing the contribution to the consumers protection - as users of housing loans, as well as the possibility of negative impact of extremely broad spectrum of information that is presented to the consumers in terms of Directive 2014/17. The final part of the work shows the possible parallels with the regulations on the protection of consumers of financial services in the B&H entities.
International Burch University