If you are a debtor to an MFO, your debt will grow at a breakneck speed, interest on the agreement can reach 700-800% per annum, and if you took 10,000 “before payday”, then in a year you will already owe 70-80 thousand (from 03/29/2016). MFOs are limited). Impressive? Yes. Is it possible somehow reduce the amount of debt, if the MFO filed a lawsuit?
Such cases are much more complicated than ordinary bank loans, and many borrowers make the mistake of thinking that the court will reduce interest rates. If the debtor still does not appear in court for the reason “I haven’t received a notice from the court,” then the MFO’s claim will be satisfied 100%. You MUST come to court - I constantly talk about this in my articles. Interest on MFO loans by nature are not a measure of liability, therefore, the court cannot reduce them on the basis of your petition, unlike a penalty or a fine - you can safely ask them to reduce them on the basis of Art. 333 Civil Code of the Russian Federation.
MFO filed a lawsuit
When suing an MFO, the debtor has 2 options - file a counterclaim and recognize the agreement invalid deal or ask reduce interest on the basis of Art. 17 part 3 of the Constitution of the Russian Federation (abuse of law). Both paths are ambiguous and it is impossible to predict what decision the court will make.
If a transaction is declared invalid you need to know that the statute of limitations for such disputes is only 1 year from the date of signing the agreement, and given that the microfinance organization always files a lawsuit after a year, the deadline will be missed. To recognize a transaction as enslaving, 4 factors must be present:- the borrower is in difficult circumstances (that is, a loan on such unfavorable terms should be a necessary measure for him);
- completing a transaction on extremely unfavorable terms for the party (the ratio of interest on the loan to the current refinancing rate);
- a cause-and-effect relationship between the borrower’s difficult circumstances and the completion of a transaction on extremely unfavorable terms;
- awareness of the MFO about the listed circumstances and using them to their advantage (the most difficult thing to prove).
Second way (interest reduction) more or less has a judicial perspective, and there is corresponding practice (court decisions can be viewed,
Not a single credit institution, be it a large bank or a microfinance company, forgives debts to borrowers. So, if you made a serious mistake under the loan agreement, then, most likely, you will be sued. Let's consider whether microfinance organizations sue debtors and what to do in such a situation.
Do microfinance organizations sue debtors?
Yes, they serve. Of course, the basis for initiating a case is considered to be an outstanding debt on time. If you violate the terms of the contract, the creditor has the right to collect the debt through legal proceedings. For some reason, society has the following opinions on this matter:
- An MFO will not sue if the amount of debt is small, because they do not want to pay legal fees for every small case. In fact, legal costs cannot be more than 4% of the amount of the claim, and paying 4% even from 20 thousand rubles is not a problem for MFOs. Moreover, if the microfinance organization wins the case, then the borrower will pay the costs.
- MFOs file a lawsuit only when the statute of limitations expires, that is, after 3 years have passed from the date the loan payment delay began. In fact, for the court, your statement that the MFO specifically filed the lawsuit late so that you would be charged penalties on the debt will not play any role. Filing a claim within 3 years from the date of violation of the terms of the loan agreement is the right of any creditor, and it does not matter whether he filed an application to the court on the first or last day of the limitation period.
Attention: It is not advisable to avoid receiving a subpoena. The failure of the debtor to appear does not in any way impede the consideration of the case, and if you appear, you will have a greater chance of a positive outcome for you in considering the MFO’s claim.
In what cases does a microfinance organization sue a borrower?
Large microfinance organizations most often go to court, because they pay more attention to their reputation. Small credit companies first turn to collectors and only in extreme cases resort to the help of courts. Of course, even if we consider one microfinance organization, it can carry out collections using different methods.
The borrower should be prepared for the fact that collectors will either visit him or receive a subpoena in the following cases:
| Cases | Practice |
| Features of loan security | If the collateral was large property, then if the court decision is positive for the creditor, the property will go to him. |
| Large debt | In practice, microfinance organizations sue when the amount of debt is more than 50 thousand rubles. |
| Minimum payments | If the borrower does not make even the minimum payments, then microfinance organizations often sue him (in this case, even the amount should not play any role). |
| Participation in SRO "MiR" | If an MFO is a member of the SRO “MiR”, then it cares about its reputation, and, therefore, collects debts exclusively through the courts. |
| The borrower has valuable property | MFOs sue those borrowers from whom there is something to take. |
Attention: if the amount of debt is more than 500 thousand rubles, then the microfinance organization may not sue the borrower, since he has the right to declare himself bankrupt and not pay the debt.
Can an MFI not sue?
Maybe. Each microfinance organization independently determines under what conditions it should take the debtor to court, and under what conditions it should hand it over to collectors.
If you contact a microfinance organization to get a loan, then immediately ask them how they deal with creditors who are late in payment or who have big problems repaying their debt. As a rule, each MFO has its own rules.
According to Russian legislation, microfinance organizations and other credit organizations do not have the right to sue a debtor if the amount of debt is less than 10 thousand rubles. So, if the amount of your debt (including fines and penalties) does not exceed this amount, then they will definitely not sue you.
Let's now look at the reasons why MFOs may not sue, in more detail:
| Causes | Description |
| Availability of a lawyer | If an MFO does not have a representative lawyer in the region in which the debtor lives, then it will not be able to sue, since no one will be able to provide an organization at the court hearing. |
| Lawyer ready to travel | Even if an MFO has a lawyer on its staff who will travel to other regions, in most cases such expenses are not beneficial to the MFO. |
| Availability of property from the client | Even if the court made a positive decision on the claim for debt collection, then if the borrower does not have property and bank accounts, then he simply will not be able to pay the debt. |
Attention: the main reason why a microfinance organization does not sue is the latter’s attitude towards it. A positive decision on a claim for debt collection in favor of an MFO in almost 100% of cases obliges the borrower to pay only the body of the debt without penalties or fines.
Small MFOs prefer to sell unscrupulous borrowers to collectors, because collectors are better at repaying the MFO’s debt than the courts. Moreover, many microfinance organizations are willing to accommodate their clients, and if you have financial difficulties, first try to resolve them amicably with the credit institution. Perhaps the MFO will offer you to restructure your debt, or provide you with a short credit holiday.
Is it possible to appeal a court decision?
You can appeal a court decision within 1 month from the date of the announcement of the court decision. Of course, you won't be able to appeal the decision unless you have the right grounds. So, if the borrower simply does not have the money to pay the debt, then this fact cannot be a sufficient basis for an appeal.
As a rule, court decisions in which serious errors were made are subject to appeal. For example:
- During the trial, sufficient evidence was not provided to make a competent judicial decision;
- during the trial, legal norms were incorrectly applied;
- the parties were not properly notified of the timing of the trial and dates. time, including changes in them;
- the court did not provide the minutes of the meeting, or the minutes were drawn up incorrectly (for example, there are no signatures).
If these or similar grounds exist, the borrower can safely file an appeal.
If it is still not possible to file an appeal, then be prepared for the following actions on the part of the bailiffs:
- seizure of your property;
- imposing a ban on traveling abroad;
- Prohibition of driving a car or other vehicles.
As you can see, the consequences for a negligent borrower can be very serious, so it is better not to bring the matter to court.
How to avoid paying debt
The debt will grow because penalties will be accrued monthly, and that is why it is best to try to come to an agreement with the microfinance organization rather than wait until your case is transferred to collectors or to the court.
An MFO may offer you to restructure your debt, which means that the credit institution is ready to renegotiate the terms of the loan agreement with you. So, maybe she will offer you temporary credit holidays, or a lower loan rate.
Also, a microfinance organization can make a concession and offer loan refinancing, i.e., issuing a new debt to pay off the old one. The new loan will be provided to you on more favorable terms, which means that it will be easier to pay.
Attention: refinancing sometimes leads to a debt trap and should be agreed to only as a last resort.
You can avoid paying the debt only in two cases: upon the death of the borrower (only when the heirs refuse the inheritance), and also upon the expiration of the statute of limitations. Of course, it is possible that the microfinance organization will simply forget about you for 3 years and no one will force you to pay your loan debt, however, the chance of such an outcome is extremely small.
Rating 4 Frequently Asked Questions
Question No. 1. The MFO sued me. What documents should I collect to prove that my financial condition has deteriorated greatly and I cannot pay the debt?
Collect all certificates (for example, a certificate from an entertainment center or from work), as well as checks that confirm that before your financial situation worsened, you regularly paid the loan.
Question No. 2. I don't pay the loan. Will the MFO immediately sue me, or will it first sell my debt to collectors?
It all depends on the rules of the MFO itself; it is better to contact the credit institution for clarification.
Question No. 3. What will happen to me if a microfinance organization sues me?
If you have no reason not to pay the loan, then most likely you will be required to repay it. In extreme cases, you will be required to pay not only the loan itself, but also penalties on it.
Question No. 4. I'm getting ready to go on a trip. I remembered that I didn’t give a small loan to Micro-Finance. Will they let me go abroad?
They will let you out. A ban on traveling abroad can only be imposed by a court decision, and you have not had a trial.
In microcredit structures, as in large financial companies, there are so-called “white” and “black” lists of borrowers, the former are responsible payers who are provided with loyal conditions for further cooperation. The latter are characterized by numerous arrears and a continuously increasing (due to interest rates) amount of debt.
MFOs and debtors. Litigation
In the event of a collision with an unscrupulous client who ignores all norms and loan repayment terms, the microfinance organization can take the following measures:
- Penalties established under the loan agreement;
- Replenishing your credit history with negative entries that can ruin the reputation of a responsible payer;
- Calls from microfinance organizations with demands to repay the debt in the established amount and taking into account interest;
- If you “ignore” all of the above points, creditors will transfer the loan case to a collection agency, or go to court.
Litigation (as well as turning to collection services) is an extreme measure resorted to by structures issuing microloans. In fact, microfinance organizations, as a full-fledged lending system, have the right to sue malicious debtors. Thus, we will answer the question “can microloans be sued?” Yes they can.
Indeed, the statistics of claims filed by microfinance organizations has increased significantly. Often, the judicial process is initiated bypassing the stage of “peace negotiations”. In order to avoid reaching the stage of “court with an microfinance organization,” before contacting a microfinance organization, you should think about your financial situation and take into account the real possibilities in the context of strict debt repayment deadlines. Often, negligence in relation to “quick loans” (on the part of the population) leads to complete financial collapse and lengthy legal proceedings.
MFOs solving the problem in court
In order for the expected to coincide with the real state of affairs, it is necessary to understand which microfinance organizations file lawsuits against debtors, and which microfinance organizations should not be expected to file a claim. If you work with microfinance organizations, in terms of statistics on litigation, de jure, this method of debt collection is practiced to a greater extent by large players in the lending sector, since here we are talking directly about the reputation and quality of the loan portfolio.
De facto, regarding the questions “are microloans filed in court?” and “which microfinance organizations file lawsuits?” There are quite a lot of answers, namely microcredit structures. However, even taking into account a single microfinance company, due collection can be carried out in several ways; however, it is worth waiting for a meeting in court and looking for information on the topic “how to sue a microfinance organization” in such cases as:
- The concluded agreement is collateral (the guarantee is the movable/immovable property of the borrower), in such cases, collection in court is the fastest way to transfer property into the ownership of the organization;
- The loan amount is more than 500 thousand rubles (the microfinance institution may “go into the red”, since the client has the right to declare himself bankrupt);
- Debt repayment is completely ignored;
- The company's regulations do not provide for joint work with collection agencies; the decision is made exclusively within the framework of current legislation;
- Sale of debt to debt collectors who practice debt collection in court;
- The debtor owns valuable property.
Mpho takes the case to court. Further actions
After the immediate stage of initiating the case, the debtor is given a subpoena. Further ignoring is pointless: the court decision will be made at the currently known place of registration of the debtor. Refusal to appear in court will also not interfere with the trial and sentencing.
In fact, if the microfinance organization has provided a complete evidence base indicating the existence of an outstanding debt, the case will “play” in favor of the microfinance organization. All the defendant can count on when he appears in court is to file a motion to reduce the penalty interest. If a clear discrepancy between the interest and the principal amount of the debt is revealed, the court has the right to regulate the amount of interest in its own way.
Within 30 days from the announcement of the decision on the claim of the microfinance organization, the defendant has the right to appeal the judicial outcome, of course, on serious grounds (lack of funds is not a serious circumstance). You can appeal a court verdict if significant violations were noticed during the process:
- The MFO’s evidence base was incomplete, but the court decided on the terms of loan repayments;
- The rules of law were applied incorrectly or ignored;
- The trial was carried out without key representatives of the parties (due to lack of proper notice);
- Lack of trial protocol and signatures on the decision itself.
If the listed violations are detected, the court of appeal has the right to note/change the decision made in the case.
Execution of the decision and payment of the debt
It also happens that even after the decision has entered into legal force, the debtor-defendant continues to ignore the fulfillment of debt obligations. In this case, the bailiff services will take over the case, followed by the initiation of enforcement proceedings. As part of this, bailiffs carry out measures to enforce a court decision. Exactly:
- Seizure of the property and account of a malicious debtor (if funds are available, they are written off in favor of repaying the debt in the microfinance organization; in the absence of the required amount, the property is confiscated with its subsequent sale);
- Ban on travel outside the Russian Federation;
- Deprivation of driver's license with confiscation of vehicles.
As for trying to avoid paying debts, there are few options. They come down to two parameters:
- Death of the borrower (acts as a serious reason for canceling the contractual force in the event that the debtor’s relatives refuse the inheritance; otherwise, the obligations for loan repayments are assigned to them).
- Expiration of the statute of limitations. In theory, an outcome is possible in which the microfinance organization simply forgot about the borrower, and 3 or more years have passed since the conclusion of the agreement (in this case, the creditor will no longer be able to file a claim).
Let's consider several options for getting out of a critical situation without bringing the case to court. There are few actions in such situations that go out of control, but:
- Extension of contracts with organizations;
- Deferment of payments (if the client provides documents confirming a deterioration in their financial situation);
- Loan restructuring.
It is worth noting that 95% of microcredit organizations offer to extend the agreement. You just need to pay the accumulated interest and sign an agreement to postpone the payment terms. It is much more difficult to obtain a deferment of payments and restructuring, since consideration of an application to revise the terms of the loan agreement (due to a changed financial situation) will take quite a lot of time. It is not a fact that such a statement will be approved.
Conclusion
Despite the criticality of the situation, there are ways to get out of the “debt hole”. Contacting a lawyer can also be beneficial; a specialist will review your case and develop an algorithm for a legal way out of the crisis. Help in repaying the loan from creditors, lawyers, the state and also from the collectors themselves is quite real, since court cases in disputes of this kind are no longer categorically one-sided. Decisions become flexible and the position of the defendant is taken into account. If the debtor's situation has really gotten out of control, the case is considered in favor of the borrower, with the release of his exorbitant amount of overdue interest.
As the microfinance market expands, the number of disputes between borrowers and lenders also increases. The main controversial points: unreasonably high interest rates on loans, threats from collectors, the reluctance of microfinance organizations to change the terms of loan agreements if the borrower experiences insolvency. In this article we will talk about in what cases a debtor can resolve a controversial situation in his favor, and how he can protect his rights in court.
How relevant is the problem of non-repayment of loans for MFOs?
If you believe the statistics, then at the beginning of 2017, problems with loan repayment were recorded among 40 million citizens of the Russian Federation. Approximately one third of all debtors are microloan borrowers (small amounts, short terms and exorbitant interest rates).
The active population of Russia is about 80 million people, 15 million of whom have outstanding obligations to MFOs. This is a gigantic problem that is constantly monitored by the state apparatus.
The legislator is looking for ways to limit the uncontrolled issuance of loans at exorbitant interest rates, the executive branch exercises local supervision over each microfinance organization, and the judiciary resolves controversial situations related to the fulfillment of loan agreements by the parties.
A real confirmation of the influence of state control on the microcredit market is the general trend of decreasing interest rates for using money: if a year ago the average daily rate was about 2%, today you can find loans with a rate of 1% and even 0.5% per day.
Increased attention from government agencies to the activities of microfinance organizations is increasingly becoming the reason that semi-legal lenders completely refuse to formally collect debts. But this is the exception rather than the rule.
An MFO will not go to court to collect debts if the organization was registered in violation of the law, if the loan agreement contains obvious legal defects, if the statute of limitations has expired (three years) or if the documents for issuing money to the borrower have been lost.
You should not assume that small amounts (up to 10,000 rubles) are uninteresting for MFOs. When calculating interest for using credit funds at a rate of 2% per day, even 5,000 rubles in a year will turn into 40,000 rubles. And this is already a serious financial reason for going to court.
Methods of work of MFOs with debtors
The procedure for collecting receivables is determined by the laws of the Russian Federation and local regulations of the enterprise. There is no standard procedure for working with debtors, therefore MFOs are required to build their relationships with borrowers in accordance with the general rules of civil, financial and economic law.
Legal methods of influencing borrowers who do not fulfill or do not fulfill their debt obligations on time (unscrupulous borrowers):
- written notices of delinquency;
- official written request for repayment of credit debt;
- claims;
- filing a claim in court for debt collection;
- presentation to the bailiff service of a writ of execution issued by the court.
And it's all. However, often MFOs are not limited to the listed methods. Also used:
- calls to work;
- threats to relatives;
- home visit, etc.
When assessing these actions of the lender, one should be guided, first of all, by the rules for maintaining the confidentiality of credit relations, which also apply to microfinance organizations. Article 9 of Federal Law-151 “On microfinance activities and microfinance organizations” determines that MFOs do not have the right to disseminate information about their borrowers and lending conditions.
Accordingly, any calls to relatives, visits to employers or other actions as a result of which third parties become aware of the loan are illegal. If, as a result of the illegal dissemination of information about the borrower, the latter suffers material and/or moral damage, the debtor has the right to file a claim in court for compensation for the damage caused.
Some microfinance organizations issue local regulations on debt collection procedures. The provisions of this document cannot violate the requirements of the law. For example, if the Regulations of the MFO indicate that in case of late payments, the creditor’s employee has the right to visit the debtor at the latter’s place of residence for the purpose of inventorying the property, then this provision cannot be considered legal, since it violates Art. 25 of the Constitution of the Russian Federation, according to which housing is inviolable.
Tactics of protection from microfinance organizations in case of insolvency
If it so happens that a microloan is taken and used, but there is nothing to pay interest and repay the debt, then The most dangerous tactic is to wait. A debtor who takes a wait-and-see approach risks increasing his debt obligations seven or even ten times. To prevent this from happening, if financial conditions worsen, the borrower should immediately begin actively working with a microfinance organization.
The most common situations of deterioration in financial situation: dismissal, illness, force majeure. As soon as unfavorable circumstances begin to apply to the debtor, he has the right to apply to the microfinance organization with a request to freeze the debt, reduce the interest rate and defer or installment payments.
You can write an appeal to the microfinance organization yourself. The body of the letter must include the following information:
- name of the microfinance organization and its legal details;
- number and date of the loan agreement;
- amount of principal and interest;
- a statement of facts confirming the deterioration of the financial situation;
- a request to defer the payment of the principal amount and reduce the amount of interest for the use of money.
The debtor signs the text of the letter and attaches copies of documents confirming the adverse circumstances. The letter must be delivered directly to the office of the MFO or sent by registered mail with notification.
Even if the MFO does not respond to this letter or sends a refusal, then during court proceedings and determining the amount of debt, such a letter will become a very strong argument in favor of the defendant, who asks the court to reduce the amount of interest collected.
The MFO filed a lawsuit
The delivery of a statement of claim to the debtor by the microfinance organization does not always mean that the creditor has begun legal proceedings. Some companies use demonstrating intent to go to court as an effective way to force debtors to voluntarily pay off their debts. To do this, MFO lawyers prepare a package of claim documents and send it not to the court, but only to the debtor, so that the latter has the opportunity to assess the scale of the problem.
In approximately half of the cases, such a maneuver brings positive results to the MFO. Seeing huge numbers of debt obligations, plus demands for payment of state fees and legal services, the debtor is looking for a way to quickly pay off his debt. This option of pre-trial preparation allows microfinance organizations to speed up the process of returning money and save on paying state fees.
These actions on the part of the MFO cannot be called illegal, but if you intend to defend your right to reduce the amount of debt on the loan, then do not respond to the statement of claim, but wait for a subpoena.
Some MFOs go even further; they themselves fabricate a copy of the court decision, using only a PC and a photocopier. Such actions are already criminal offenses and a debtor who received a non-existent fake court decision by mail has the right to report a crime.
You should begin preparing for a lawsuit with an MFO in the following cases:
- the debtor received a subpoena;
- the debtor received documents indicating that the microfinance organization had applied to the bailiffs to execute a court order to collect the debt from the borrower.
Having made sure that the matter has been officially moved forward, the debtor must decide: to involve a lawyer in solving this problem or to do it on his own.
The participation of a lawyer who has practical experience in resolving disputes with microfinance organizations will allow the debtor to save his own time and nerves, but will cost a tidy sum (about 10% of the amount of the claim).
If the debtor has free time and a desire to independently protect his interests, then he can conduct the trial on his own.
About 80% of legal disputes end in negative decisions only due to the party’s failure to comply with procedural formalities!
When working on his defense, the defendant must pay attention not only to arguing his position and appeals to justice, but also carefully comply with all the requirements of the civil process.
The main procedural points that the court pays attention to:
- filing by the defendant of objections to the claims, attaching copies of supporting documents;
- attendance at all court hearings (if there is a good reason for failure to appear, then it is necessary to send a petition to the court in advance with a request to postpone the consideration of the case);
- familiarization with the case materials (studying the documents provided to the court by the plaintiff);
- compliance with deadlines for appealing court decisions;
- the defendant’s use of his rights to present his own evidence, conduct examinations, give explanations, question witnesses, etc.
The objection form for filing a lawsuit can be downloaded from the link.
Each procedural action must be correctly completed and completed in a timely manner.
How do MFOs formulate their claims?
Most often, microfinance organizations delay filing a lawsuit for two to three years from the moment the borrower ceases to fulfill its obligations. This is done so that the amount of debt increases tenfold. The creditor is not interested in collecting 10,000 rubles. Therefore, if an MFO is silent for a long time and does not demand its money back, this does not mean that the debt is forgotten or forgiven. Most likely the debtor is on the counter, and every day the amount to be collected is growing.
When forming their claims, MFOs indicate in the claim the following:
- debtor's details (address of residence and registration, telephone number);
- details of the loan agreement and order, according to which the debtor actually received the money in hand (copies of these documents must be attached to the application, and the originals must be presented to the court);
- clauses of the agreement that define: the date of loan repayment, the procedure for calculating interest in case of delay in loan repayment, the amount of fines and penalties for failure to fulfill contractual obligations;
- a request to the court to collect the principal debt, interest for using the loan, penalties and fines;
- a request to the court to recover from the debtor the legal costs incurred by the plaintiff.
There are no restrictions on the amounts collected. If claims are made within the limitation period, then the court will accept the claim with any calculations and arguments. The validity of the plaintiff's claims is determined during legal proceedings.
Grounds for reducing the claims of an MFO
It is possible to completely win a case against an MFO only in the following cases:
- if the debtor has payment documents that confirm that the debt is fully repaid;
- if the MFO cannot provide the court with the original loan agreement or the original order under which the borrower was given money;
- if there is evidence that the debtor entered into an agreement without full civil capacity, or under the influence of deception or threats.
However, such disputes rarely end up in court. Basically, the MFO goes into the process with demands that are reasoned and supported by appropriate evidence. But even in this case, it is possible to partially win the trial. Moreover, the percentage of claims not recognized by the court often reaches 60-80%.
Grounds for reducing debt subject to forced collection:
- abuse of the plaintiff's right (the courts indicate that the MFO dishonestly used its right to calculate interest: it delayed the deadline for going to court and applied a rate that was tens of times higher than the rate of the Central Bank of the Russian Federation);
- the plaintiff did not take into account the significant deterioration in the debtor’s financial condition.
If the courts take these circumstances into account, then the debtor is charged the amount of the principal debt plus an amount equal to the amount of the principal debt to repay interest. So, for example, if the principal debt was 5,000 rubles, then in addition to this amount, 5,000 rubles of interest are also collected, a total of 10,000 rubles.
Court with MFO at the initiative of the debtor
When is it beneficial for a debtor to sue an MFO, and what is this benefit? In fact, the borrower will not receive any significant benefit from such a process. You can count on the management of the MFO to evaluate the debtor’s legal knowledge and not risk making unreasonable demands on him.
But this circumstance can play both for and against. There is a high probability of a conflict of interests, and then the debtor will have to allocate a lot of money and time in order to still defend his position in court.
Only the following categories of claims against MFOs have a positive judicial perspective:
- the debt is repaid, but the MFO continues to send letters accruing interest;
- the loan agreement was drawn up in violation of the requirements of the Civil Code of the Russian Federation and the norms of microfinance legislation (the debtor recognized the agreement as not concluded or invalid).
- The MFO transferred information about the borrower to third parties (for example, a representative of the lender called relatives or the employer), as a result of which the debtor suffered damage.
You can go to court with a claim for an MFO to reduce interest on a loan only if the interest is calculated in violation of the terms of the agreement. For example, the agreement provides for a daily interest rate of 2%, but the MFO calculated it at 3%.
If the interest amounts are calculated correctly, but the debtor does not have the opportunity to repay them, then you should only contact the microfinance organization itself with requests to amend the terms of the agreement determining the amount of interest. If the MFO goes to court to collect a debt from the borrower, such letters will be adequate evidence that the debtor tried to resolve the dispute, but the MFO refused to revise the rate.
It is almost impossible to force the creditor through the court to reduce the current interest rate. In addition, the process may drag on for several months, and all this time the lender will have every right to charge interest at the rate specified in the agreement.
A sample claim form can be downloaded from this link. As a general rule, a statement of claim is filed with the district court at the location of the defendant (MFI or its branch).
Judicial perspective
In judicial practice today there are a large number of court decisions made in favor of borrowers. The decision of the Kirovsky District Court of Samara http://sudact.ru/regular/doc/0PnzvXMrSLQV/ is considered indicative.
But there are also a huge number of decisions not in favor of debtors. An example of argumentation in the decision of the Bratsk City Court of the Irkutsk Region http://sudact.ru/regular/doc/cd7CsuoEVglr/.
Therefore, you should not count on an easy victory.
If the debtor does not agree with the decision of the court of first instance, then he has the right to appeal this decision to the court of appeal. The appeal must be filed within one calendar month from the date of the decision by the court of first instance.
If a party to the case was not properly notified of the trial and the decision made, then he has the right to ask the appellate authority to restore the deadline for appeal. In this case, the complaint must be sent within a month from the moment the borrower became aware that there was a court decision not in his favor.
The relationship between the borrower and the lender is governed by civil law, and therefore, even if it so happens that there is a delay in loan obligations, there is no need to be afraid that this debt may become a reason for criminal prosecution. People are not sent to prison for debts to microfinance organizations and cannot face any other liability other than civil law (i.e. a fine).
Most often, after the completion of legal proceedings in favor of the debtor, MFOs lose interest in him and stop all prosecution. If the court was lost, then the MFO works with the bailiff service and insists on the speedy execution of court decisions. But even in this case, such illegal methods of influence on the part of MFOs, such as calling relatives or visiting employers, are excluded. All communication between the debtor and the creditor occurs through the bailiff, who is involved in specific enforcement proceedings.
In most cases, the attitude towards microloans is strictly categorical: some consider them almost a panacea that can save them from all troubles, while others frown contemptuously or even recall their negative experiences. It is useless to talk about the fact that MFOs do not forcibly bring money to anyone and do not force them to take it: any adult should understand that sooner or later they will have to give back what they have borrowed. Moreover, before issuing a loan, the borrower receives a document to sign, which sets out in detail his rights and obligations. By putting his signature, he confirms that he agrees with all the points, and whether he read them or not is a matter of his personal responsibility.
Borrowers who do not repay microloans can be divided into two groups:
- Persons who, due to circumstances beyond their control, are unable to make loan payments. As a rule, these are those who have lost their jobs, suddenly encountered a serious health problem (for themselves or their loved ones), requiring financial investments, etc.;
- Persons who believe that nothing will happen to them for failure to pay their debt, since the MFO is a non-governmental organization.
This division is called conditional because the management of the organization from which you took out a loan is, by and large, not interested in the reasons and motives for non-payment: their only interest is to get their money back, preferably with a considerable profit. To achieve this goal they go to great lengths.
Borrower's responsibility for non-payment of microloans
There are very few people who read everything that is indicated in the document that they must sign when taking out a microloan from letter to letter. That is why there are so many who are indignant at the amount of money required by microfinance organizations in case of overdue debt, although all these nuances were initially specified in the contract. For the same reason, questions arise such as whether microloans can be sued, what will happen if you don’t pay bills, will they go to jail for non-payment, etc.
In fact, everything is quite simple: microfinance organizations take on a huge risk, issuing loans to almost anyone, even people with a negative credit history or no credit history. To justify this risk, they tried to protect themselves as much as possible from non-payment, therefore, in case of late payment, the sequence of their actions in relation to debtors is as follows:
- A call with a question about the reason for the delay and an offer to find a solution to the issue as quickly as possible (extension, restructuring, etc.);
- Transfer of your data to the Bureau of CI of the Russian Federation, indicating that you are an unscrupulous payer (it is unlikely that you will be able to take out a bank loan if you have such a stain on your reputation);
- Transfer of debt to a collection agency, and not a state one operating within the framework of the Legislation of the Russian Federation, but some private one that does not choose methods of putting pressure on debtors. Their favorite “entertainment” is threatening calls at any time of the day, both to you and to your loved ones, whose contacts she has; informing all your neighbors about your work debt, as well as posting leaflets with your photo and indicating the amount of debt in the immediate vicinity of your place of residence;
- Applying to the court for microloans.
Any next step is taken only if no attempts have been made on your part to correct the situation after applying the previous one.
In what cases do microfinance organizations go to court?
The increasing number of microloan lawsuits is explained by the fact that MFOs have only one opportunity to get their money back: to persuade their unscrupulous borrowers. How they will do this and what words to choose is another question, but threats are the maximum they are capable of. It is not within their competence to take away property from the debtor; this can only be done by the court.
By law, the management of the commercial organization that issued you a loan can go to court immediately after you have violated your obligations, i.e. the very next day after the unpaid next installment. However, don't expect bailiffs to come to you in the next couple of months. Why? The answer is simple: any microfinance organization has a penalty for late payment that is much higher than the already considerable interest on the loan itself, and therefore it is simply beneficial for them that you owe as much as possible. However, this does not mean that microloans can not be repaid at all - judicial practice knows many examples when the borrower was nevertheless obliged to repay the borrowed funds.
What can happen to a borrower after a microloan trial?
Let's talk about the pleasant thing right away: as soon as the MFO files a lawsuit against you, the amount will no longer increase until the court makes a decision on the microloan - even if the process drags on for weeks or even months. Simply put, the moment a claim is filed, the “counter” stops. True, the question arises here: if, nevertheless, the amount specified in the claim is prohibitively large, what should be done?
Do not wait. What the court will allow you not to pay - this will not happen. Every person who voluntarily and consciously applied for a microloan had to understand that the money would have to be repaid. However, the colorful picture described by collectors of how you are taken out of the courtroom in handcuffs and taken to prison under the condemning glances of others is also not true. Of course, in the vast majority of cases, the court’s decision on a microloan ends up on the side of the borrower, but the borrower still receives certain benefits for himself.
Is court beneficial for the borrower?
A logical question: if the court almost always orders to repay the debt and pay legal costs, why do MFOs not so often resort to this method of returning microloans - judicial practice resolves a relatively small number of debt claims. There are several explanations for this.
Firstly, many debtors simply “do not reach” the stage of filing an application with the court and, under pressure from collectors, doing everything possible and impossible, they still pay off the debt. Secondly, institutions issuing microloans know about the possibility of reducing the amount of the penalty, and therefore are not in too much of a hurry to go to court.
The conclusion is obvious: if a person who took out a microloan does not pursue the goal of simply appropriating money for himself, but for truly objective reasons cannot pay contributions, the court is beneficial for him. An optimal solution will be found, for example, the debt will be divided into several payments, which will be deducted from the borrower’s salary. In addition, if the court considers the amount of the initial amount taken to be unfair with the amount of compensation required by the MFO, it can significantly reduce the requested amount, or even oblige the debtor to pay only the loan amount and interest on it.
Can they be sued for microloans if they are not repaid in a timely manner? They can. However, law-abiding citizens who simply find themselves in a difficult situation have absolutely nothing to fear. Such measures are unpleasant for people who initially intended fraudulent actions and have absolutely no plans to give back what they took. The rest face either debt restructuring or an inventory of property owned by the borrower (except for vital items) for debts. Of course, any lawsuit is an unpleasant event, so it is best not to wait for the case to go to court, but to fulfill your obligations under the loans taken.
