Rus Articles Journal

How not to get to a credit loop?

the financial crisis which Burst in 2008 left the mark on relationship of banks and borrowers.

So it turned out that part of people who took the credits to pay off with confidence on them in time lost an income source, or their income considerably decreased. Especially critical the situation became in the market of mortgage lending. People acquired real estate at the cost of 2007-2008 when the prices were at peak, and now are forced to pay for apartments which market value decreased.

Due to the crisis situation at some borrowers the monthly sum of payments on the credit began to exceed the sum of the income. The bank which annually estimates a financial condition of borrowers - natural persons considers deterioration in a financial condition of the borrower as a negative factor which influences assessment of category of quality of the credit .

Simple words, it means that the bank is forced to create at the expense of the income on such credits an additional reserve on possible losses according to the loan (RVPS) for a case of non-performance by the borrower of the obligations. What does it threaten with

to the borrower?

Decrease of category of quality according to the loan, as a rule, causes more fixed monitoring of a financial condition of the borrower from bank. And it means that if you suddenly lose a source of the income and you will not be able to pay monthly payments on the credit (3 times and more), the bank has the right to turn collecting regarding pledge - housing, the car and other property which you acquired at the expense of the credit, - or to transfer your debt to collection agency.

What to do in such situation?

the bank is the best of all to notify

on the arisen financial difficulties in advance and to petition in writing for change of conditions of the credit agreement - restructuring. Restructuring of the credit in bank terminology is understood as change of essential conditions of the credit agreement (period of validity of the credit, an interest rate, etc.) towards their improvement for the borrower.

In what benefit of restructuring of the problem credit for bank?

in case of restructuring of such credit the bank can not increase risk level on the credit and consequently, not to create an additional reserve at the expense of the income. Restructuring can mean increase in term of the credit and reduction of an interest rate for the borrower that can significantly reduce monthly payments. In some banks there is also a practice of delivery of the stabilization credits which the bank issues to the borrower for repayment of percent on earlier issued mortgage loan.

So that not to appear in “a credit loop“, it is the best of all for borrower to adjust dialogue with bank, in detail to inform him on possible sources of the future income, for example: sale of the car, receiving inheritance, second work etc. Such data will help to convince bank of your solvency not to apply to you the sanction.

And still: in spite of the fact that the bank has the right in case of formation of arrears on the credit to appeal to court, this measure is put only as a last resort into practice, so kakpredpolagat additional labor costs for bank. Besides not always the sum of the declared claim requirement of bank is satisfied with court in full.

The main thing, remember that rescue of drowning - work drowning!