Today, many people reach for additional financing in the form of credit. Please note that we can rely on its limitation after 3 years. How to do it and how to calculate the limitation period? What to watch out for and what to do if your bank wants to prevent us from being barred? We’ll read about it below.
Who makes the decision that the loan has expired?
You should know that the loan is time-barred after three years have passed. This is stated in the Civil Code itself, also the legislator took care of regulating this issue directly in art. 118. This term applies to both consumers and persons who conduct business activities. However, it is important that the loan was granted by an entity which conducts business activities in this area. So here we are dealing with all banks. To be precise, it is enough for one party to carry out activities related to providing financing in the form of economic activity. This is no longer required of the borrower.
How to calculate the limitation periods for a loan?
We already know that for loans, the limitation period is 3 years. But how to calculate this date, since we pay most loans in monthly installments. Usually these installments are scheduled so that we know exactly when to pay. Similarly, the limitation period will be calculated separately for each loan installment. In addition, if we do not repay individual loan installments, the bank calls us to pay. If we do not react to this, then the contract is terminated. What are the effects of this?
- The loan amount is due in full
- The repayment schedule ceases to apply to us
- We must give back the borrowed amount in full – the part that we have not yet repaid.
- Installments due before termination, are barred each separately
- Installments payable according to the schedule, but after the loan is terminated – they will expire on one date.
Postponed limitation to the end of the year
We mentioned at the beginning that the limitation period for the loan will be 3 years. However, legal changes that entered into force some time ago meant that the rules for counting the end of the limitation period, in some situations, will lead to the situation that it will occur almost after 4 years. This is due to the fact that the date is postponed to the end of the year. This rule is not taken into account only in cases where the limitation period is shorter than two years – but this obviously does not apply to loans. To sum up, therefore, the last day of the limitation period falls on the last day of the calendar year.
The consumer has an easier way to expire – why?
We should first distinguish between two concepts, which are often mistakenly identified with each other. Expiration of the loan is not synonymous with cancellation, it is important. But already in the event that our lender – that is, the bank – wants to recover his debts in court, the court will dismiss his application and lose the case. If we have a loan and want to take advantage of the limitation period, the court will not automatically take this into account. We must make this complaint ourselves so that it is upheld. This rule applies to all persons conducting business activity. In the case of consumers, the court will ex officio check whether the bank’s claim is time-barred. If the limitation period has expired, the bank will not be able to expect payment from the consumer. What does the court pay attention to first? Well, as we mentioned – the length of the limitation period. It may also take into account the specific circumstances in which the borrower finds himself, in order for the bank to prevent the bank from pursuing its claim, etc.
What aspects should be taken into account when the loan is time-barred?
One more point needs to be raised, namely what if the limitation period is interrupted? This can happen when a court files a lawsuit against us as borrowers, raising the payment obligation. Further on, an application for enforcement may be sent to the bailiff. Hence the very short way to give the bank enforcement title an enforcement clause. Then our limitation of credit ceases to be safe for us. Any interruption of the limitation period must be counted anew. Let’s add that while our debt is subject to court assessment or is at the bailiff’s, the limitation period is suspended and does not run at all. We can also, as borrowers, interrupt the limitation period by recognizing the bank’s claim. We should analyze the situation beforehand to follow our interests as well as the possibilities we have.