Many of us have found ourselves in the difficult position of not being able to repay our debts. Bad loans and overdue debts have unfortunately become a common phenomenon. Maybe you've asked yourself "what happens if I don't pay the consumer loan", "what happens if I owe the bank and I have nothing to my name" or "when are the debts to the banks time-barred".
We will try to solve all your questions, however you should keep in mind a general but very important principle: Banks do not give money away and will only leave you alone if they exhaust all margins.
What is the difference between the cancellation and the statute of limitations?
For mortgages, it is known that the bank will take your house after you have pledged it in order to receive the loan. The issue is what applies to consumer loans , which in most cases are unsecured, and any other loans that do not have a mortgage.
Also, we should make it clear that it is one thing to write off credit card debts or loans (and the credit loan is considered) because the years prescribed by law have passed, and another to write off the loan or debt from the bank. The difference is that:
- The statute of limitations usually expires after 20 years, while
- Deletion is at the bank's discretion and certain conditions must be met.
Let's see in detail what applies in each case to the statute of limitations or cancellation of debts to banks.
When are debts to banks time-barred?
As a general principle, bank claims are time-barred after 20 years. Not of course from the day you got the loan, but from the moment the bank cancels the loan agreement .
This happens when the debt has become overdue and you don't comply with what the bank asks to even proceed with debt settlement. Therefore, a consumer loan can only be statute-barred if 20 years have passed since its termination. The exact same applies to the statute of limitations on credit card debts.
The point is that from the moment the loan contract is terminated, the bank immediately proceeds with all the required legal actions, such as issuing a payment order. In other words, don't expect that the years will pass without it "bothering" you.
With the payment order, the bank will try to seize any assets that can be seized by law.
What if I have no property and am in debt?
Here comes the eternal question of borrowers. Can you sleep easy if you have nothing to your name? You will have heard some say, "I don't care let the banks do whatever they want to me, I have nothing to my name".
And yet, it is not so, since for this case too, the legislator has ensured that the creditor (ie the bank) can take legal action to be financially satisfied.
Not having a property in your name does not mean you have no property. Seizure for loan debts can be done for almost everything, except unseized payroll accounts and those up to the amount of 1,500 euros.
Do you have shares in your name? They can be confiscated. Bank accounts? Also. Even claims from third parties. If e.g. you have a company and the company is in debt, then the company's claims can be seized. The same applies to individuals.
What is true about Unrestricted?
As far as non-seizure is concerned, there is article 982 of the Code of Civil Procedure, which protects wages, pensions and insurance benefits deposited in bank accounts, from seizure up to the amount of 1,500 euros.
The unconfiscated amount rises to 2,000 euros, in the case of a family account. You should, however, have declared the account as payroll or pension for it to be unencumbered.
When are bank debts written off?
No bank gives out loans. The basic principle is that before it considers the loan or credit card debt as "uncollectible" and writes off the debt, it will do everything.
Banks will exhaust all available means to check your property and income situation and will try to recover all or part of the debt, before... leaving you alone. There is no time limit for loan cancellation, since it is purely the bank's decision.
And now you know what applies to the statute of limitations on credit card and loan debts. If you want to know more about loans and cards, we are here. Find on our online platform details about the banking products that concern you and compare them to find the one that suits you, without standing in line at the banks!
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