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It happens that a person is faced with an overdue debt. In connection with this, collectors start annoyingly calling her, which encourages her to borrow money from other people or even take a new loan in order to repay the previous one. This is all just the beginning of a “snowball” that can gradually grow and include new loan debts in number and size.
The main thing you can do in order not to get bogged down in bigger debts is to write off the debt. Certain cases in which this function can be implemented:
- Insurance: A smart step when getting a loan is to take out an insurance contract that provides protection in case of unforeseen circumstances, such as job loss, property damage, health problems or death. Insurance can be expensive, but it provides financial protection against creditors.
- Bankruptcy: In court, it is possible to determine a natural person as bankrupt thanks to the Code of Ukraine on Bankruptcy Procedures, but this will lead to certain costs. The bankruptcy procedure can be initiated only by the borrower who has no property and/or savings, otherwise the court may require the sale of property to repay part of the debt. Social status does not affect the possibility of obtaining bankruptcy status. Bankruptcy does not always result in a full discharge of debts, and the court can impose various conditions, including deferment of payments or write-off of interest, but not all debts can be discharged, such as utility bills or fines.
- Disability or disability: In order to take advantage of the opportunity to cancel the debt due to an injury or disability that prevents earning, it is necessary to confirm the disability of the 1st or 2nd group or the incapacity with documents from a doctor and file a lawsuit to write off the debt.
- Expiration of the debt statute of limitations: The law of Ukraine provides for a statute of limitations of 3 years, during which a lawsuit can be filed in court to write off the debt, if there have been no payments on the loan. It is important to avoid signing any documents that may extend the statute of limitations or prevent the discharge of the debt after its expiration. The terms of the contract are no less important, as banks sometimes set a very long statute of limitations, for example, 50 years, and in this case debt cancellation through the court becomes impossible.
- Liquidation of a legal entity: If you have a loan against a legal entity, the liquidation of that company through bankruptcy proceedings can help you write off the debts that have accumulated in favor of that company after paying tax liabilities, settlements with employees and repayment of losses. Once the funds are distributed after liquidation, any outstanding debts are automatically written off.
- Death of the borrower: The heirs receive not only the property of the deceased, but also his debts. These debts can not be repaid, but only if you refuse the inheritance. It is important to take into account that debts are covered only by the value of the property that was inherited. However, it should be remembered that the bank has a limited period, namely six months, to demand repayment of the debt after learning about the death of the borrower. In addition, relatives and loved ones of the deceased can go to court to try to cancel the debt or get a write-off of fines and fees associated with the use of credit funds.
In Ukraine, there are legal ways to write off debts, and it is possible. In order for such an action to be successful and effective, the team of the law firm “Prykhodko and Partners” is always ready to help. Qualified lawyers will do everything qualitatively and you will get a positive result.