The largest banks in terms of volume of loans to individuals have recently begun or are planning to use a simplified procedure for collecting retail debts in the near future. To do this, it is enough to include in the loan agreement a clause on the possibility of collecting overdue payments on retail loans without court on the basis of a notary’s writ of execution in an indisputable manner, writes Kommersant.
Banks acquired this right thanks to amendments to the “Fundamentals of Legislation on Notaries” that came into force in July. Raiffeisenbank, Home Credit Bank and Russian Standard began to include a corresponding clause in loan agreements in October. , VTB 24, VTB and Rosbank plan to do this from January, and are now “adapting processes to the new mechanism.”
A notary's writ of execution is an order to forcefully collect the amount of debt in favor of the creditor or to reclaim the debtor's property. In order to apply it, mention of such a possibility of the lender must be written down in loan agreements or additional agreements thereto. If there is a clause in the agreement, after receiving the notary’s writ of execution, the bank can immediately turn to the bailiffs to collect the debt, bypassing the court.
The bank can receive a writ of execution if the loan is overdue for more than two months. The norm applies to agreements concluded after the amendments entered into force, or to old agreements if there is an additional agreement signed by both parties.
The main advantage of the new mechanism for banks is the increase in collection speed. In addition, the creditor's costs for obtaining a writ of execution will be reduced, in particular, the amount of state duty for obtaining a writ of execution is generally lower than for going to court.
Meanwhile, according to human rights activists, the new norm is a big problem for citizens. “Borrowers will not even have the opportunity to enter into negotiations, defend their rights, their debts will be collected automatically,” fears Dmitry Yanin, chairman of the board of the International Confederation of Consumer Societies.
Not only debtors, but also professional collectors may suffer from the application of the new simplified debt collection procedure by banks. However, everything will depend on how widely banks will apply the new mechanism in practice, market participants say. As the head of the legal department of the Federal Notary Chamber, Alexander Sagin, explained, a notary’s writ of execution allows one to collect only the body of the debt and the interest provided for in the loan agreement, but not penalties and fines. In addition, banks have yet to determine for what amounts and types of loans this particular method of collection is most effective.
A clause has been added to the agreements of credit institutions on the possibility of collecting debt out of court based on a notary’s writ of execution, reports "Kommersant". /website/
Debt collection under a simplified scheme became possible after amendments to the legislation of the Russian Federation came into force in July. The norm applies to contracts that were concluded after the amendments entered into force, and to old contracts in the presence of an additional agreement signed by both parties.
The new debt collection scheme makes life difficult for borrowers and threatens the business of debt collectors. However, it will increase the speed of debt collection and reduce the costs of creditors for obtaining a writ of execution (for a writ of execution the amount is lower compared to a statement of claim to the court). Even if a two-month debt arises, the bank has the right to contact a notary.
A notary's writ of execution is an order to forcefully collect the amount of debt in favor of the creditor or to reclaim the debtor's property.
According to the publication, of the 10 largest banks in Russia, 7 banks have already begun to use or are planning to use a simplified debt collection scheme in the near future. For this purpose, a clause on the possibility of collecting debt on retail loans without court on the basis of a notary’s writ of execution is included in the loan agreement.
If this clause is present in the agreement, the bank may not go to court, but after receiving a writ of execution, involve bailiffs in the case.
How to dispute a debt?
The problem with the innovation is that citizens' debts will be collected automatically. By signing the agreement, the borrower agrees to all the bank’s terms and conditions.
“Borrowers will not even have the opportunity to enter into negotiations, defend their rights, their debts will be collected automatically,” fears Dmitry Yanin, chairman of the board of the International Confederation of Consumer Societies.
The borrower will be able to challenge his debt through the court if he files a claim immediately after receiving a notice from the bank about late payments before the bank receives a notary’s writ of execution, Sergei Korolev told a REGNUM correspondent.
Collectors may be laid off
A simplified procedure for collecting debts can lead to a reduction in collectors - professional debt collectors. However, this depends on “how widely banks will apply the new mechanism in practice,” believes Dmitry Zhdanukhin.
The notary’s writ of execution allows for the collection of only the “body” of the debt and interest under the agreement. At the same time, penalties and fines remain unaccounted for, Alexander Sagin explained to the publication.
Collectors will come in handy
Since January 2017, the law “On the protection of the rights of individuals when carrying out activities to repay overdue debts” has come into force in Russia. According to it, the borrower does not have the right to remind the debtor to repay a debt over 50 thousand rubles. To do this, he must turn to the services of a collector, otherwise he faces a fine of up to 500 thousand rubles.
According to the press service of the National Association of Professional Collection Agencies, the organization receives about 30 letters a month from individuals who cannot repay the debt. Previously, collectors only worked with bank debt. Now they have to start “knocking out” debts for individuals.
Since collection agencies work with debts from 50 thousand rubles, there is an option that the collectors left without work will start “knocking out” smaller debts, says Oleg Rodin.
Trends in changes in legislation in the field of regulation of bank lending show, on the one hand, the restriction of collection activities, on the other hand, the endowment of banks with increasing powers to independently collect debts.
One of the first legislative changes in this area was a 10-fold increase in the amount of requirements for obtaining a court order - from 50 to 500 thousand rubles. The 2015 Supreme Court Resolution also made its contribution, effectively allowing bailiffs seize and place restrictions on the debtor's only home. Today another legislative innovation has appeared - the right of banks to extrajudicial collection of loan debts on the basis of a notary’s writ of execution.
Features of extrajudicial collection of credit debts by banks
The possibility of initiating forced collection of a debt on the basis of a notary’s writ of execution existed before - nothing has changed in this regard. However, before the summer 2016 amendments to the legislation on notarial activities, such a right arose only subject to notarization of the loan agreement, which was never done. Now the ability to carry out collection in an indisputable manner on the basis of a notary’s writ of execution under loan agreements is a norm that is directly enshrined in the law, and it does not matter at all whether the agreement or not, like other transactions, was certified by a notary. The only exceptions are microloans. This legislative provision does not apply to mortgage loans due to the peculiarities and nature of the collections carried out on them. The remaining credit debts can be collected by bailiffs only on the basis of an application received from the bank and a loan agreement on which a notary’s writ of execution has been made.
Some nuances:
- The bank’s authority to collect the loan debt by obtaining a notary’s writ of execution on the agreement and subsequent appeal to the bailiffs must be contained in the terms of the loan agreement. This means that by signing an agreement or an additional agreement to it, the borrower is formally informed of this right by the bank and agrees with it.
- The bank is obliged to notify the debtor about the debt in writing and 2 weeks before the planned application to the notary, but the borrower cannot influence the process except to pay off the debt.
- Only debts that are no more than 2 years old at the time of applying for a writ of execution can be collected without dispute.
- For bailiffs, a notary's writ of execution on a loan agreement and a court decision on collection are equivalent, that is, they can immediately, upon receipt of documents from the bank, initiate enforcement proceedings in the same way as if a court order or decision with a writ of execution had been received in this regard .
- The amount of the debt, the period of delay and other circumstances of the formation of debt on the loan do not matter, which allows the bank to independently decide when exactly to start forced collection - after a couple of days of delay or at any time during the 2-year period of formation and accumulation of debt.
- The debtor's participation in the process of obtaining a notary's writ of execution is not provided. Formally, he can learn about the initiation of the process from the bank’s notification, but in fact - when a call to the bailiff or a notification from him has already arrived.
- There is no special procedure for appealing the actions of a bank, notary, bailiffs, or their decisions. The borrower-debtor will have to act in the general manner, independently going to court if there is disagreement with the amount of recovery, the actions (decisions) of the participants in the procedure or other circumstances.
Banks’ position regarding innovations
Today, banks positively assess the decision of legislators, which actually expands the range of tools for forcing debtors to pay on loans. At the same time, many representatives of the banking sector are still speaking with caution about the possible activity of credit institutions in this area of collection.
Each bank will most likely take an individual approach to considering a specific debt situation. But in the case of massive problem debts, numerous delays by the borrower, or the obvious inability of the latter to fulfill his duties, the decision will be unambiguous. In addition, the amount of collection under a writ of execution can include not only the principal debt and interest, but also penalties, as well as bank costs associated with notarial actions. The out-of-court alternative also looks more effective - the way the court studies the case materials, even the magistrate, when issuing an order, the notary will not do. Therefore, it is possible that in the near future extrajudicial collection will seriously outstrip the issuance of court orders in terms of the number of procedures, not to mention lawsuit proceedings.
Not long ago, Russians learned that banking organizations began to apply a new debt collection scheme. Due to the innovations that were supposed to come into force with the onset of 2017, panic arose in society.
We'll tell you how the pre-trial debt collection process works, who should be afraid and what to expect in the near future.
What does the new simplified diagram look like?
Banking organizations began to use new debt collection scheme from your clients.
To do this, now bank representatives do not need to go to court and “knock out” debts by decision of the authorities, but only come with documents to a notary and get his signature.
Known that bank representatives will not, and cannot, change loan agreements previously concluded with individuals, because there are no legal rights to do this.
To simplify the work flow, it is now enough for the bank representative to take order with a writ of execution from a lawyer.
The document will confirm that he can, without a court decision, contact the bailiff service, who will handle the return of funds to the organization.
Who will be affected by the new debt collection procedure?
Of course, not all individuals will be involved in this process, but only those who have:
- Debt to a banking organization for a period of at least 2 months.
- A new type of agreement, which contains a line on the pre-trial procedure for debt collection. Please note that the old agreements did not have such a clause. The line in the new documents could have been added in the summer of 2016, when the bill was adopted.
According to the innovations, a bank representative must prepare documents, confirming that the client is a debtor and has not fulfilled his obligations for 2 months.
In addition, the specialist must notify the client in advance, approximately 2 weeks in advance that he will be forced to contact a notary.
They will also take into account whether the client has an additional agreement with the bank.
There is another option for the development of events. According to Alexey Barikhin, a lawyer at the Association of Public Organizations "Civil Control", a citizen has every right to go to court and file a statement of claim with his demands against the creditor.
However, the best option is to negotiate with the bank and come to a compromise solution on debt payments.
Advantages and disadvantages of pre-trial debt collection – what is the opinion of experts?
Basically, the benefits of the innovation will concern banking organizations.
Let's list what good will come from the pre-trial debt collection procedure:
- The main advantage is that the procedure and collection scheme will be simplified.
- The speed of return of funds to the organization will increase.
- The costs of banks that were spent on court resolution of cases will decrease. Contacting a notary will cost less.
According to Yulia Tarasova, Deputy Director of the Department of Troubled Assets at VTB 24, the costs of banking organizations will decrease significantly. This will happen because the state fee for a lawyer’s services will be lower than the amount for going to court.
But the disadvantages of the innovation will affect borrowers-debtors and collection agencies:
- They will contact collectors less often, since the bank will directly cooperate with bailiffs, and it will not matter whether there is a court decision or not.
- There will be less work for collection agencies, which means a reduction in the number of companies cannot be avoided. And in general, according to the general director of the Collection Development Center, Dmitry Zhdanikhin, the pre-trial collection procedure means a reduction in the market.
- Borrowers-debtors will not be able to establish relationships with the bank and enter into negotiations.
- Clients of organizations will have to defend their rights through the courts. This is exactly how Dmitry Yanin, chairman of the board of the International Confederation of Buying Societies, put it. He believes that it will now become impossible for citizens to come to an agreement with the bank without third parties and organizations about possible debt payments.
The availability of bank loans is a double-edged sword. On the one hand, this is good. You can always get additional resources to turn your plans and ideas into reality. On the other hand, it’s bad. Many Russians are accustomed to literally “living on credit.”
All major purchases, and sometimes food products, are purchased using credit funds. Many borrowers cannot cope with such a high debt load. They overestimate their financial capabilities and can no longer fulfill their obligations to the creditor.
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What to expect in this situation? What is the bank's debt collection procedure today? These questions are relevant for many Russians.
General provisions
Oriental Express Bank, Alfa Bank, Delta Bank and other Russian banks actively advertise their loan programs. But their main goal is not to give away money, but to earn maximum income. For lending, banks do not use their own funds, but borrowed ones.
Individuals are depositors and are the main “sponsors” of financial institutions. If borrowers do not repay the loans received, the bank will not be able to fulfill its obligations to depositors. Therefore, they will use all possible methods to collect the debt.
As soon as clients have difficulties repaying their loans, they begin to hide from banks, thereby aggravating their situation. The financial institution has no choice but to begin the debt collection process. First of all, this procedure is needed in order to obtain a court decision on forced full repayment of the loan debt.
But the client can turn this situation to his advantage. In particular, submit a response petition to the court in order to revise the debt downward. Article 333 of the Civil Code states that the court may cancel or reduce excessively high fines.
If you build your defense competently, then it is quite possible that the amount of the bank’s claim will be significantly reduced. But it is very difficult to cope in this situation without the help of a qualified lawyer. It is quite possible that you will need to contact a legal agency and pay for the services of a specialist.
Fundamental differences
The presence of overdue debts is not only a problem for the borrower, but also for the bank. Financial institutions make every effort not to bring the case to court. Neither party needs additional costs for the litigation. Therefore, the client is offered programs for debt restructuring and extension of the contract.
The borrower may even have the interest rate reduced and given a credit holiday. But this all depends on how valid the reason for the overdue debt is.
Overdue
Depending on the reason for the debt, defaulters are divided into the following categories:
The pre-trial process begins with the bank engaging collectors to help. He delegates to the agency the right to represent his interests. Bank secrecy is also disclosed: the loan agreement number, the borrower's residential and registration address, contact numbers, and information about the debtor's property are reported.
In general, all information that may be useful for debt collection. This is considered simplified debt collection by the bank. If neither the collectors nor the security service were able to achieve the desired result, a new scheme for working with the debtor is developed.
In particular, information is collected on the availability of assets that can be sold to pay off debt.
A loan restructuring scheme is also being considered, and its final version is discussed with the borrower
Without trial
With the adoption of Law No. 360-FZ, banks received the right to demand repayment of debt without a court decision.
This procedure is carried out according to the following scheme:
- The financial institution informs the borrower about contacting a notary for 14 days.
- The bank pays for notary services for endorsement of the loan agreement.
- Provides the notary with a loan agreement.
- The notary indicates on the contract that an executive inscription has been made and puts his visa.
- Within three working days, the debtor receives a notification from the notary's office.
- The bailiff begins his work to collect the debt without a court decision.
Under this scheme, the bank can return only the principal debt and accrued interest. To collect punitive damages, court permission is required.
The borrower has the right to challenge the bank’s actions in court at the location of the notary’s office. To file a claim, the client has only 10 days. The countdown begins from the date when it became known about the imposition of the writ of execution.
Debt collection without court is impossible in the following cases:
- the lender is a microfinance organization;
- the loan agreement contains a provision that the debt can only be collected through legal proceedings;
- the debt period exceeds 24 months;
- on mortgage loans.
The writ of execution contains information about the amount of debt, accrued interest and the bank’s costs for paying for notary services. Thus, the notary's inscription has the same force as a writ of execution. After the adoption of Law No. 360-FZ, borrowers found themselves in unequal conditions.
Financial institutions have been given greater powers to deal with defaulters. So be careful. Think carefully before signing an additional agreement offered by the bank.
Alternative to collectors
Banks were given the right to demand repayment of the debt without a court decision so that they would refuse to cooperate with collectors. As a result, the collection procedure will become more transparent and civilized.
But opinions on this issue are divided. Many people believe that the work of collectors is more effective than that of bailiffs. If the borrower does not have any property, then the bailiff will not be able to confiscate anything.
Accordingly, the debt will remain outstanding. Collectors put extreme psychological pressure on the client and force him to pay off the debt. That is why banks will continue to resort to their services.
Claim and writ proceedings
The most reliable way to force a client to repay a debt is to file a claim in court. The claim will be satisfied only if the plaintiff provides sufficient evidence of the existence of debt obligations.
After the writ of execution is received, the bank can independently contact the borrower’s employer to force the debt to be repaid from his salary. But this option is possible if the amount of debt does not exceed 25 thousand rubles.
But in most cases, debt collection is carried out by bailiffs.
In writ proceedings, there is no plaintiff and defendant, only a creditor and a debtor, and the consideration of this case will require a minimum of time, because the court simply accepts an order to collect the debt
Writ proceedings are possible if a number of documents are available:
- notarized agreement;
- receipts for borrowing money;
- agreements for payment for goods or services provided.
The debtor has the right to challenge the court order if he does not agree with the bank’s requirements.
Standard bank debt collection scheme
To deal with debtors, banks use the following methodology:
- Letters are sent to the client demanding repayment of the debt, they call him and his relatives, and find out the reason for non-payment.
- Contacting collection agencies for help. Their employees use harsher methods in their work and very often resort to threats.
- Going to court. If the amount of debt does not exceed 500 thousand rubles, then the bank can contact the magistrate and obtain a court order. This document is both a decision and a writ of execution.
- Enforcement proceedings based on a court order.
The procedure does not always include all these steps. Sometimes it is enough for the borrower to communicate with collectors or the security service in order for him to repay the debt. Also, a financial institution can restructure the debt and resolve this issue amicably.
Latest changes to the procedure
The adoption of Law No. 230-FZ made changes to the work of collection agencies. The new rules come into force in 2019. Now collectors are prohibited from calling debtors at night and spreading information about them.
The client has the legal right to refuse to communicate with debt collectors. To do this, he must draw up a corresponding letter and send it to the creditor.
If the borrower cannot repay the debt, then he:
- tries to negotiate with the bank to reduce the monthly payment;
- asks for credit holidays;
- begins bankruptcy proceedings.
But the last point is quite controversial, since the title of “bankrupt” has many negative consequences for the borrower.
What influences the decision
Previously, it was believed that during debt collection proceedings, the decision would always be in favor of the financial institution. But in recent years, borrowers are increasingly challenging the legality of the concluded agreement and the amount of accrued debt.
The amount of accrued fines and penalties can be reduced only if the client provides irrefutable evidence of the incommensurability of the fine and the principal debt.
It is very difficult to completely invalidate a contract. But it is quite possible to challenge some of his points. For example, the order of debt repayment, transfer of client data to third parties. But the borrower must remember that the statute of limitations for such issues is three years. If this term has ended, then your requirements will not be satisfied.
Thus, we can draw the following conclusion. It is always easier to prevent a problem than to solve it. Do not apply for a loan if you are not 100% sure of your financial capabilities. And if you find yourself in a difficult financial situation, do not hide from the creditor. Ask for a deferment or restructuring. Do not bring the matter to court, but resolve this issue peacefully.
It is carried out in accordance with the principle that if there is insufficient property, spouses are obliged to bear joint responsibility for debt obligations.
Under what conditions is it possible to collect wages, read in.