When is an online loan contract void or time-barred?Uncategorized
When borrowing money, also via the Internet, a contract is made. One of its parties is the lender providing funds, and the other is the borrower who obtains funds and undertakes to return them, together with interest, within the period specified in the contract. However, if and when can the loan agreement be invalid and can the loan be time-barred?
When can a loan expire?
First of all, you must be aware that each case is different. Therefore, to determine whether a loan is invalid or has expired, you may need to consult a lawyer. It is, however, important to be aware of the general rules regarding when it may be invalid or expired.
Expiration of the loan means that the lender has no further opportunity to recover the liability. In other words, in this case the borrower is no longer obliged to pay his debt.
For online loans from loan companies, such as payday loans, the limitation period is generally 3 years. This deadline is calculated from the date on which the loan should be repaid, and not from the date of the loan. This means that in the case of installment loans, the limitation period is calculated separately for each installment. The limitation date is longer in the case of borrowing from natural persons and may then be 10 years.
So when the borrower does not repay the loan within the period specified in the contract, the borrower may for several years try to enforce the repayment of the liability with interest, eg through a bailiff. Therefore, the borrower may also be called to pay additional costs, eg those related to bailiff proceedings.
Delay in settling the obligation and waiting for the claims to expire, may end with the loss of some or even all of your assets. What’s more, overdue debt is recorded in the catalogs of debtors, such as KRD or BIK, which may hinder or prevent the chance to take another loan for many years.
Therefore, the most important thing is to borrow funds consciously, ie make sure that you can pay your debt on time. Before entering into a loan agreement, you should also read it carefully. If you have a problem with repayment, you should contact the lender as soon as possible to solve the problem, eg take advantage of a refinancing loan.
When is the loan agreement invalid?
The loan agreement, when using the services of loan institutions, is concluded in writing, thanks to which both parties know exactly what conditions they agree to. If a loan agreement is concluded, eg online, and all the provisions of the agreement comply with the law in force at that time, then the loan agreement is valid and all obligations related to it should be respected.
At least in theory, it may turn out that the provisions of a given contract are inconsistent with applicable legislation, eg anti-usury act. Then there may be grounds for declaring at least part of the contract invalid. Such cases, however, practically do not occur, and determining whether a given contract is invalid requires consultation with a lawyer. Therefore, it is safest to borrow from reliable loan companies and read the contract carefully before concluding it, and then the risk of concluding an illegal contract is minimized practically to zero.
What is withdrawal from a loan agreement?
It is worth remembering the possibility of using the so-called withdraw from the loan contract, which you have 14 days. Withdrawal from the contract, however, does not involve any additional fees or commissions. In such a case, of course, however, it is necessary to refund the funds obtained, together with interest for the period in which they were holders.
Withdrawal from the loan agreement must be in writing and reach the lender within 14 days of its conclusion. A specimen of such a letter should be made available by the lender, eg on its website. It should therefore be completed, signed and delivered, eg by sending a registered letter with acknowledgment of receipt.
Taking advantage of the withdrawal may be beneficial when, for example, the loan was contracted ill-considered, under the influence of emotions. However, it is definitely better to remember about borrowing in a thoughtful and responsible manner.
Remember to borrow consciously
It is worth being fully aware of your rights and obligations, the more so that life can be unpredictable, and knowledge about the limitation period, invalidity or the possibility of withdrawing from the contract may be useful. In some cases, however, specialist legal advice may be needed.
So it’s definitely best to avoid problematic situations and borrow reasonably. Each loan must be taken reasonably, from a reliable source and after carefully reading the loan agreement.