First, let’s note what will happen to the borrowers who do not pay the loans taken by them?
Deterioration of credit history.
The inability to obtain credit in the future.
The accrual of penalties.
The penalties for each day of delay.
Regular visits of collectors.
The banks appeal to the court.
Regular visits of bailiffs.
Failure to complete the registration transaction.
The inability to travel abroad.
Distressed debt to banks is constantly increasing. If in 2010 in Russia the borrowers owed to the creditors of 2.7 trillion roubles, in 2011, this amount was closer to 3.2 trillion rubles. In 2012 this figure has exceeded 4 trillion rubles. However, the indicators of debt that did not participate in the proceedings. Why?
Getting into a variety of complex situations, borrowers first try to ask for help and to find support in our banks, but the banks, as commercial entities, can’t just take and write off the interest on the loan or even to reduce debt. The maximum the Bank can only give a little leeway on payments, but not more, because the conversations with the banks are often meaningless.
Of course, some customers will be quite enough a small delay, but most continues to delay payments, forcing the banks to charge them interest and penalties. Debt hole gets deeper and deeper. Output, at times, it’s gone. In a short period of delay, the debtors, the sum total debt could grow to several times due to various fines, penalties and commissions.
The only salvation of the borrowers in this situation is the court. Borrowers are confident that the courts will take into account and take into account the difficult situation in the life of a debtor and reduce the amount of debt or interest, by purging this amount also from the Bank extra markups. In addition, the courts will appoint an acceptable scheme of repayment of debts, based on current financial capacity of the debtors.
But the problem here is that banks are not in a hurry to go to court. There are several explanations for this behavior:
First, do court proceedings cost the banks dearly, but because if the banks see that the borrower is absolutely nothing to take, and the court them to turn makes no sense.
Secondly, the courts often side with the debtor and reduce them total amount of debts that may not be profitable to banks. Because banks prefer to turn first to the collectors.
Thirdly, banks do not need to rush to court, since for each day of delay they may charge penalties and interest.
As a rule, banks are being sued after approximately 2.5 years after the start of the non-payment of the loan. Why this time?
Because loans have a Statute of limitations, which is three years. If within three years the banks in court not asked, the loan will just be deducted from borrowers.
But until that time why would they rush? It is much better to hire collectors or sell them all debts, and they, in turn, will be pretty torturing for the debtors.
The debtors just have to hope that after three years, and they will go to court with the statement about the expiration of the limitation period on the loan, and problems with the loan immediately disappear.