In accordance with Russian law, a loan agreement concluded between a bank and an individual may be terminated before its expiration date. Depending on the basis on which the agreement will be terminated, the procedure for terminating the relationship between the bank and the client is determined.
Instructions
Step 1
The most common ground for termination of an agreement is by agreement of the parties. In this case, the contract can be terminated without any significant restrictions for each party. However, in some cases, termination of the contract by agreement of the parties may have certain consequences for one or both of them, for example, the obligation to compensate for lost profits or incurred losses.
Step 2
Termination of the loan agreement can also occur at the initiative of one of the parties. In this case, the borrower has the right to terminate the loan agreement if the other party (bank) has not fulfilled its essential conditions (amount or term of the loan, interest rate, etc.).
Step 3
The lender has the right to terminate the agreement in the following cases: - if the borrower violates the terms of the agreement regarding the procedure for repaying the loan, namely, untimely or in an incomplete amount, returns the principal and interest on it;
- if the loan, which provides for the targeted use of funds, was spent for other needs that do not meet the terms of the agreement. In this case, as a rule, the bank increases the interest rate on the loan, applies penalties or requires an early repayment of funds;
- if the borrower has not fulfilled the obligations to secure the loan (surety, pledge, bank guarantee), i.e. did not provide or concealed information about its loss or decrease in quality;
- if the financial condition of the borrower has significantly deteriorated or there are facts of filing a property claim against the borrower;
- if there is information about the upcoming bankruptcy, reorganization or liquidation of the borrower - a legal entity.
