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1. Member States shall ensure that creditors and, where applicable, credit intermediaries are required to provide adequate explanations to the consumer on the proposed credit agreements and any ancillary services that make it possible for the consumer to assess whether the proposed credit agreements and ancillary services are adapted to the consumer’s needs and financial situation. Such explanations shall be provided free of charge and before concluding the credit agreement. The explanations shall include the following elements:

(a) the information referred to in Articles 10, 11 and 38;

(b) the essential characteristics of the credit agreement or of the ancillary services proposed;

(c) the specific effects that the credit agreement or the ancillary services proposed may have on the consumer, including the consequences of payment default or late payment by the consumer;

(d) where ancillary services are bundled with a credit agreement, whether each component of the bundle can be terminated separately and the implications for the consumer of such termination.

2. Member States may, in justified cases, adapt the requirement referred to in paragraph 1 with regard to the manner in which the explanations are to be given and the extent to which they are to be given to the following:

(a) the circumstances of the situation in which the credit is offered;

(b) the person to whom the credit is offered;

(c) the type of the credit offered.