The presence of loan delinquencies does not give the borrower anything good. The bank charges interest and fines, the security service requires debt repayment, often by rather aggressive methods. The situation is aggravated when debt collectors intervene. Despite the fact that the law limits their powers, communication with the “knock-out” of debts is not a pleasant one. In these cases, it is worth contacting a professional lawyer. It can help to resolve the situation with credit debt in a favourable direction for the borrower.
Renewal of a contract on terms favourable to the client (restructuring).
One of the main tasks of a lawyer who represent you is to restructure a loan. This term means the revision of the current terms of the loan agreement so that the client can fulfil his obligations without undue financial burden. Restructuring works in relation to bank loans and loans taken from microfinance organisations. The main condition is that the lender does not change, only the terms of the agreement are transformed.
There are several ways to restructure:
- decrease in the interest rate (in relation to bank loans it is used extremely rarely, most often it is possible to reduce the interest rate on a loan from microfinance organisation, justifying this by the fact that the borrower is in a difficult financial situation);
- an increase in the loan repayment period (in this case, the amount of the monthly payment is proportionally reduced, but the total amount of the overpayment increases);
- shift of the date of payment (for example, closer to the salary, so that the borrower has money on hand);
A lawyer can justify the need for restructuring to the bank, indicating that only in this way the borrower will be able to fulfil his obligations. It is more important for the creditor to receive their funds, albeit with delays or in a smaller amount, than not to receive them at all or “knock out” the debt through the court, enduring additional costs.
As practice shows, a professional lawyer has more chances to convince the management of a bank by negotiating to provide restructuring than the client himself.
Refund of unlawfully collected commissions, fines and penalties.
In the event of delays, the bank charges interest in accordance with the terms of the agreement. If you do not pay for long enough, the number of fines can be a significant part of the payment. It is important to note that when paying for a loan, the bank directs the funds received primarily to pay off the interest. As a result, debt may arise when the standard payment is made.
A professional lawyer is able to challenge the interest charged by the organisation. Often, financial institutions impose penalties bypassing the terms of the agreement, referring to internal regulations or ordinances. This is not allowed, as well as unilateral tariff changes. For example, if the bank raises the interest for the delay on credit cards, then this applies only to new borrowers, these changes cannot affect the previous ones.
In addition, the help of a lawyer can be useful in difficult situations, when, for example:
- money was not credited on time due to equipment failures ( for technical reasons);
- the payment failed due to an operator’s error;
- there was a shortage of funds during the next replenishment due to exchange rate differences (occurs if the money was “frozen” at the time of payment, and the actual transfer – later);
- it was not possible to pay at a bank during a national holiday.
Refinancing a loan in another bank.
If it was not possible to carry out refinancing in your bank, then a lawyer can help you arrange a loan in another bank under the refinancing program. The specialist will undertake the work on the preparation of documents characterising the potential borrower exclusively from the positive side.
The fact is that under refinancing programs, banks are trying to attract only solvent borrowers, i.e. actually lure them away from competitors. It is much more difficult for debtor payers to obtain a new loan since their solvency is in question. The task of the lawyer is to convince the bank that the borrower needs to improve the terms of the agreement, and then he will be able to fulfil his obligations.
In addition, if the payer has “grey income”, for example, from freelancing or leased property, a lawyer will always tell you how to legalise them and use them to improve your credit rating.
Representing the interests of the company
One of the most frequent functions of a lawyer is to protect the debtor when the debtor is a company.
Often, firms and companies try to save on such an item of expenses as legal support of activities and turn to lawyers when the solution to a problem ends in a lost court proceeding with the imposition of penalties or criminal prosecution. However, an outwardly harmless situation can turn into a problem, the solution of which is possible only through the courts. In this case, one of the few solutions is to deregister your company.
Your lawyer will recommend you to take certain steps to take it if your company has become obsolete.
You can deregister a solvent company in two ways:
- Through the members voluntary liquidation
- By filing an application to voluntarily deregister a company if it meets certain legal requirements.
Unpaid debt and violation of an agreement often end with the initiation of a criminal case by the law enforcement agencies, which results in large material and moral losses. Never neglect to hire a good lawyer.
In situations where a decent amount of money is urgently required, many people think that the most difficult thing is to get a loan from a bank. In fact, at the moment, with a huge number of credit institutions, this is not a big deal. It is much more difficult to repay the debt. And not everyone succeeds in doing this on the conditions that are taken into account in the agreement. In such a situation contact a lawyer and you’ll be at peace.