A restructurisation of a credit debt presents an agreement on renegotiating the loan or a conclusion of a new loan agreement for the the purpose to improve the conditions of the repaying the principal if the contemporary deterioration in the financial position of the borrower is proved.
How to start a restructurisation?
In most cases the process of debt restructurisation is possible in any field of lending such as consumer credit, mortgage and ctr. The main reason for renegotiating the loan is a stable position of the borrower of being in default concerning the repayment schedule. The term " restruturisation" is used by banks when the borrower has not repaid the credit for 3 months.
The first step of restucturisation to be taken is an application of the borrower specifying the reasons why the obligation of repaying the loan in full with interest can not be fulfilled. This situation can be mostly caused by the firm or innodividual bankruptcy, deteriorating of economic environment in the country, changing of payroll circumstances, job loss and ctr. In addition to the application the bank can demand for some more papers such as passport, certificate of income and others.
One shouldn't dally off writing the application. The best moment it should be done is as soon as the borrower realizes the fact of deterioration in his financial position. In case the bank refuses to compromise, the court is likely to take the borrower's side taking into consideration a prudent approach and a strong desire to repay the principal even if under the new circumstances.
Some banks receiving the client's application are eager to enter into negotiations and produce a supplementary agreement based on mutual cooperation. It is not by chance because nobody wants to waste time on lawsuits with the insolvent. Besides the court often takes the defendant's side just for "technical reasons" so the penalty and fine payment are likely to be cancelled.
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