Forced collection of debt under a credit agreement

Loan debt is a fairly common phenomenon. Situations are not uncommon when a person has borrowed funds, but is unable to return them in time. There are also quite often situations when financial institutions impose their own lending conditions during the validity of the contract without agreement with the client. In this article, our experts - lawyers Prykhodko and Partners will tell you how and in what situations forced collection of debt under a credit agreement is carried out.

In what cases is it possible to enforce the debt under the credit agreement?

The clause regarding forced debt collection under the credit agreement must be written separately in the credit agreement. That is why, if the issue is already related to court proceedings, the borrower should carefully re-read the relevant document. The clause on forced collection must be specified, regardless of the method of collection. If the borrower does not fulfill his obligations within the term specified in the contract, one of the options for the development of events is possible:

• A loan that falls into the "problematic" category is transferred to the bank's debt collection department.
• Involvement of a collection firm.

The first option is used in most cases at the initial stage. Refunds are made on the basis of "soft" pressure on the client who is unwilling or unable to pay. Such "soft" pressure consists in the following actions: phone calls from bank representatives demanding the return of funds, threats to file a lawsuit. As for the legal action, it is very disadvantageous for the banking institution. This is due to the fact that the contract with the bank is terminated at the time the application is submitted to the court. That is, the interest rate under this contract ceases to accrue. As for the debtor, this option has a number of advantages for him:

• There is no increase in loan arrears.
• Repayment of the debt may occur outside the terms of the contract.
• The payment of part of the fines and interest may be canceled in court.
• Debt collection will be carried out not by collectors, but by bailiffs.

Peculiarities of debt collection under martial law

In wartime, there are no restrictions on debt collection under a credit agreement. This means that there are no laws limiting the creditor's ability to file a claim in court. Most often, it is the judicial procedure for debt collection that is used.

Debt collection under a credit agreement under martial law has the following features:

• The creditor shall not charge interest and penalty.
• Notaries do not make executive orders on loan agreements without a certificate from a notary.
• Started on the basis of a notary's inscription, which are suspended until the end of martial law.

Assistance of a lawyer in matters of debt collection under a credit agreement

If you are a creditor or borrower of funds and do not know how best to protect your own interests in matters of debt collection under a credit agreement, it is best to enlist the support of professional lawyers.

Prykhodko and Partners have the necessary experience related to the collection of problematic debt. We will become your reliable partners in this direction. The main key to our success is an individual approach to each client. We develop a well-thought-out defense strategy for even the most complex cases.

Do you still have questions? We are waiting for a preliminary consultation! To calculate the cost of a lawyer's services in cases of forced debt collection under a credit agreement, fill out the form below.