What the law says your loan contract must tell you

A Vietnamese home loan is governed by three layers of rules. The Law on Credit Institutions sets out who may lend and on what principles. The Law on Protection of Consumer Rights decides how a standard-form contract is read when it is unclear. And between them sits the document that matters most in practice: the State Bank’s circular on lending, which says, article by article, what the bank has to tell you and what the contract has to contain.

The rulebook, and which version applies

The Law on Credit Institutions No. 32/2024/QH15 took effect on 1 July 2024, replacing the 2010 law. It gives the bank and the customer the right to agree interest rates and fees (Article 100) and requires banks to publish their fees and the rights and obligations of customers for each product (Article 10). It does not go into the detail of a loan contract. That is delegated to the State Bank.

The State Bank’s rules are in Circular 39/2016/TT-NHNN. It is ten years old, but it has not been replaced; it has been amended five times, most recently by Circular 29/2026/TT-NHNN, effective 15 August 2026. The State Bank published an official consolidated text, 86/VBHN-NHNN, on 30 June 2026, and that is the version quoted here.

One transitional point matters. Contracts signed before an amendment takes effect continue on the terms they were signed under. If your loan was drawn in 2022, the rules that apply to it are the rules of 2022, not the rules in this article, except where your contract itself says otherwise.

Before you sign: what the bank must disclose

Article 16 of the circular requires the bank, before the agreement is made, to give the borrower:

• the interest rate;
• for a rate that will be adjusted, the principles and factors that determine the new rate and when it is adjusted;
• the rate charged on overdue principal;
• the rate charged on interest paid late;
• the method used to calculate interest;
• the types and levels of fees.

This is the legal basis for asking for the floating-rate formula in writing before you commit to anything. If a loan officer can only tell you the promotional rate, the bank has not yet given you what the circular says you are entitled to.

The eight things the contract has to contain

Article 23 lists the required contents of a loan agreement. The ones that decide what a home loan costs are these.

The floating-rate clause, read closely

The circular does not require a contract to use the words “base rate plus margin”. What Article 13.5 requires is that the parties agree “the principles and the factors that determine the interest rate, and the time at which it is determined”. In practice almost every bank expresses that as a reference rate plus a fixed margin, but the legal test is whether the formula is determinable, not whether it is phrased a particular way.

The same article contains a sentence that very few borrowers know about. Where the agreed principles and factors could produce more than one rate, the bank must apply the lowest. A clause that says the floating rate is “the higher of” two things, or leaves the bank a choice between methods, sits uncomfortably with that rule, and it is a fair question to put to the bank before signing.

What the law does not do is cap the margin or the reference rate. A margin of four points is as lawful as a margin of two and a half. The protection is disclosure, and disclosure only helps if the numbers are read. The effect of each extra half point on the worked example is set out in base rate plus margin.

Fees: allowed, listed, but not capped

Article 14 lists the fees a bank may agree with a borrower, and the early repayment fee is one of them by name. The circular sets no ceiling on it. The fee is whatever the contract says, which is why the tiers vary so much between banks and why it is one of the few terms that is genuinely negotiable on a large loan.

The practical consequence: a promise made verbally about waiving the fee after a certain year has no weight unless it is in the fee schedule attached to the contract. How much the tiers actually cost, and how they interact with the interest clawback, is worked through in the early repayment fee, tier by tier.

Standard-form contracts and the consumer law

Most home loans are signed on the bank’s standard form. Circular 39 requires that form, and the general terms behind it, to be posted at the bank’s offices and on its website, and requires the bank to give the borrower full information about it before signing and to obtain the borrower’s confirmation that it did so (Article 23.4). That confirmation is usually one of the pages you are asked to sign without reading.

The Law on Protection of Consumer Rights No. 19/2023/QH15, in force since 1 July 2024, adds four protections that apply to standard-form contracts generally:

• Clarity and language. The contract must be clear, easy to understand and in Vietnamese. Where versions in different languages differ, the one more favourable to the consumer applies (Article 23).
• Ambiguity cuts against the bank. Where a term can be read more than one way, it is interpreted in the consumer’s favour (Article 24).
• Some terms are void. Article 25 lists terms that have no effect, among them terms that exclude the business’s liability, restrict the consumer’s right to complain or sue, or let the business change the contract unilaterally to the consumer’s detriment.
• Time to read. The business must allow a reasonable time to study the contract before it is signed (Article 26).

One limit is worth knowing. A Prime Minister’s decision lists the contracts whose standard forms must be registered with the authorities in advance, and apartment purchase contracts are on it. Bank loan contracts are not. Nobody outside the bank has checked the form before you see it.

When the bank can call the loan in

Under Article 103 of the Law on Credit Institutions a bank may stop lending and recall the debt early if the borrower gave false information or breached the contract. The contract itself must list the events that allow this (Circular 39, Article 23.1(m)), and if the bank does recall a loan it must send a notice with minimum contents set out in Article 21.

Read that list. The usual items are missed payments, using the money for a different purpose and a fall in the value of the collateral. Some contracts add looser triggers, such as “a change in the borrower’s financial situation that in the bank’s opinion affects repayment”. That is lawful if agreed, but it is the clause to ask about.

Refinancing: one rule that limits your options

Article 8.6 allows a bank to lend to repay a loan at another bank, which is how refinancing works, but only if the new loan’s term does not exceed the remaining term of the old one, and only if the old loan has not been extended or restructured. A borrower who has already asked their bank to stretch the term because of a payment problem has, in most cases, closed off the option of moving to another bank. The maths of switching is in refinancing a Vietnamese home loan.

A short checklist for the signing table

1. Is there an annual rate on the actual outstanding balance, written as a number?
2. Is the floating formula complete: which reference rate, what margin, which dates?
3. Are the overdue and late-interest rates within 150% and 10% a year?
4. Is the early repayment fee schedule attached, with every year filled in?
5. Does the list of events allowing early recall contain anything vague?
6. Have you been given the standard terms, and time to read them, before signing?

If the answer to any of these is no, the bank is not being asked for a favour. It is being asked for what Circular 39 already requires it to provide.