Publication date: 15.07.2024
Procedure for collecting loan arrears in Ukraine
Introduction
Loan debt collection is an important aspect of banking activities that ensures the repayment of funds lent by the bank and maintains the financial stability of the banking system. In Ukraine, the debt collection process is regulated by a number of laws and regulations that define the procedure for banks and the rights of debtors. In this article, we will review the main stages of loan debt collection, the legal framework and practical advice for debtors.
Legal framework
The Civil Code of Ukraine
The Civil Code of Ukraine (the "CCU") is the main legal act governing contractual obligations, including loan agreements. The CCU defines general provisions on obligations, liability for their non-fulfilment and the procedure for foreclosure on the debtor's property.
Law of Ukraine On Banks and Banking Activities
This law regulates the lending activities of banks and sets out the requirements for loan agreements, the rights and obligations of banks and borrowers, and the procedure for debt collection.
Law of Ukraine "On Enforcement Proceedings"
This law establishes the procedure for the enforcement of judgements of courts and other authorities, including the collection of loan arrears. It defines the procedure for enforcement proceedings, the rights and obligations of enforcement officers and debtors.
Stages of debt collection
1. Pre-trial settlement
Pre-trial settlement is the first stage of debt collection, which involves the bank's attempts to resolve the debt without going to court. This may include:
- Reminders and warnings: the bank sends written reminders and warnings to the debtor about the existence of the debt and the requirement to repay it.
- Negotiations: the bank may offer the debtor to negotiate a debt settlement, including debt restructuring, extension of maturity or reduction of interest rates.
- Conclusion of a debt restructuring agreement: the parties may enter into a debt restructuring agreement that provides for changes in the terms of the loan agreement to facilitate debt repayment.
2. Court proceedings.
If the out-of-court settlement fails, the bank may file a lawsuit to recover the debt. The court proceedings include the following stages:
- Filing of astatement of claim: the bank files a statement of claim with the court, stating the amount of the debt, the basis for the claim and evidence.
- Court hearing: the court considers the case, hears the parties, examines the evidence and makes a decision.
- Judgement: the court makes a decision on debt collection, which may include the principal amount of the debt, accrued interest, fines and penalties.
3. Enforcement proceedings.
Upon receipt of the court decision, the bank may initiate enforcement proceedings to enforce the debt. Enforcement proceedings include:
- Obtaining an enforcement document: the bank obtains an enforcement document (writ of execution or order) from the court.
- Submission of the enforcementdocument to the executive service: the bank submits the enforcement document to the executive service body to open enforcement proceedings.
- Initiation of enforcementproceedings: the enforcement service initiates the proceedings, notifies the debtor of the commencement of enforcement actions and sets a deadline for voluntary execution of the judgment.
- Enforcement ofproperty: if the judgment is not executed voluntarily, the enforcement service enforces the debtor's property, which may include the seizure of funds in bank accounts, inventory and sale of movable and immovable property.
Rights and obligations of the parties
Rights of the bank
- To demand timely repayment of the debt and payment of interest in accordance with the terms of the loan agreement.
- To file a lawsuit to recover the debt in case of default by the debtor.
- Initiate enforcement proceedings to enforce debt collection based on a court decision.
- Demand additional collateral or early repayment of the loan in case of deterioration of the debtor's financial condition.
Bank's obligations
- To comply with the terms of the loan agreement and the requirements of the law.
- Provide the debtor with complete and accurate information on the status of the debt, accrued interest, fines and penalties.
- Consider the borrower's appeals and complaints, and hold negotiations to resolve the debt issue.
Debtor's rights
- To receive complete and accurate information on the status of the debt, accrued interest, fines and penalties.
- To appeal against the actions of the bank or the enforcement service in case of violation of his rights.
- Offer the bank to enter into a debt restructuring agreement or change the terms of the loan agreement.
- Apply to the court or regulatory authorities to protect their rights and interests.
Obligations of the debtor
- To repay the debt and pay interest in a timely manner in accordance with the terms of the loan agreement.
- Provide the bank with the necessary information and documents to assess the financial condition and fulfilment of obligations.
- Comply with court decisions and the requirements of the executive service within the framework of enforcement proceedings.
Practical advice for debtors
Cooperation with the bank
Debtors should cooperate with the bank, respond to requests and proposals, and negotiate debt settlement. This may include entering into a debt restructuring agreement, extending the maturity date or reducing interest rates.
Assessment of financial position
Debtors should regularly assess their financial position and plan their expenses and income to ensure timely repayment of their debts. In the event of financial difficulties, they should inform the bank in a timely manner and offer possible solutions to the problem.
Legal advice
In the event of difficult situations or conflicts with the bank, debtors may seek advice from a lawyer or attorney specialising in banking law. A lawyer will help assess the situation, prepare the necessary documents and represent the debtor's interests in court or before the enforcement service.
Appealing against unlawful actions
Debtors have the right to appeal against unlawful actions of the bank or the enforcement service in court. This may include challenging the accrual of unjustified interest, fines or penalties, as well as the actions of bailiffs that violate the debtor's rights.
Conclusion.
Loan debt collection is an important process that ensures the return of funds to the bank and maintains the financial stability of the banking system. The collection process includes pre-trial settlement, court proceedings and enforcement proceedings. Debtors have the right to receive information
- So, it doesn't matter if you need a lawyer's advice or a lawyer's advice. Legal marketplace "CONSULTANT" will help you solve any problem! All the necessary services at any time: analysis of documents, legal analysis of the situation, legal analysis of the situation, written advice, verification of documents by a lawyer, legal analysis of documents, legal opinion of a lawyer, legal opinion of a lawyer, legal analysis. Are you looking for an online lawyer or a lawyer online? Choose CONSULTANT - a lawyer is always at your side!
- Our legal opinion and legal opinion of a lawyer, legal analysis with a lawyer online and legal advice will help you at any time! Order a document review by a lawyer and general legal analysis right now! And with the services of a lawyer's consultation and document analysis with a written consultation - you will get the whole range of necessary services!
