Debt write-off in a legal way

Debt write-off is always a relevant topic. This is explained by the fact that citizens of Ukraine actively use credit cards, but are not always able to pay off the debts that accrue on them. As a result, this leads to the accumulation of mandatory payments, including interest, penalties and other penalties, which the financial institution applies to debtors under credit agreements. However, in practice, there are legal mechanisms for writing off such debts, although not everyone knows about them today. This shows the relevance of consideration of this topic. Therefore, in this article, we will talk about how to write off the loan debt in a legal way, while taking into account the provisions of the regulatory legal acts of Ukraine.

What is the concept of loan write-off?

A loan write-off is a legal agreement by the financial institution that the loan debt will not be repaid by the debtor. In practice, this primarily ensures that a person will not face legal proceedings to enforce the debt, including interest, interest and other penalties.

It should also be understood that the financial institution can write off the loan to the debtor in full or in part.

In full, the financial institution cancels the debt incurred by the debtor both directly on the body of the loan (the main part of the debt) and on the accrued interest. And in cases where a financial institution writes off one thing, then such debt write-off should be considered partial.

It is worth noting that partial debt write-off is the most popular option for the development of events, since in this case the bank has the opportunity to return at least part of the financial capital that it provided to the debtor.

How can you write off a loan in 2023?

Today, the legislation identifies the following ways of writing off the loan:

• Bankruptcy procedure. It is suitable for both legal entities and individuals, but each of them has its own peculiarities in practice, which are determined by the Code of Ukraine on bankruptcy procedures. After recognition by the commercial court, the debtor's debt can be written off both partially and completely, depending on the circumstances of the case.
• Death of the debtor. In this case, debts can be canceled if no one from the heirs accepts the inheritance, because according to the law, they inherit not only the property of the deceased, but also his existing debts.

• Recognizing the credit agreement as invalid. If you turn to the court and it establishes that the credit agreement was signed by a person who does not have full civil legal capacity, or the borrower's will to sign the agreement was not voluntary, or the content of the agreement itself contradicts the current requirements of the law, then in this case it can be declared invalid. As a result, this will lead to the cancellation of any debt under the contract.
• Disability or disability of a person. If a citizen has received a disability of group 1 or 2, which makes it impossible for him to fully perform his work function, then in this case it is necessary to apply to the court and ask the latter to write off the loan debt. The court will consider all the evidence in the case and may partially or fully satisfy the claimant's demands.
• Occurrence of force majeure circumstances. If the loan was obtained for the purchase of property that was destroyed or damaged as a result of military operations, the debtor can be released from paying the loan debt in court.

Do you want to write off the debt incurred on the loan? In this case, you cannot do without the help of professional lawyers - the Prykhodko and Partners law firm.

Our team not only has knowledge in the field of financial and banking law, but also has extensive experience in debt relief. So don't delay and turn to us for help!