Finding yourself in a problematic situation with a bank, it’s essential to remember that a bank is a large and powerful entity supported by dozens or even hundreds of debt recovery managers and lawyers who will strive at all costs to recover the problematic debt. Banks maintain established connections with notaries who issue enforcement inscriptions that allow for property seizure, with public and private enforcers who forcibly collect debts and have broad legal authority to do so, and even with law enforcement officers who may apply “forceful” pressure on bank debtors. Sometimes, banks may even have links with judges who can make unlawful decisions in favor of the bank. It is also common for banks to sell so-called credit portfolios to collectors, who may resort to illegal methods to “extract” debts. Therefore, it is nearly impossible for a debtor, who often lacks the necessary knowledge of legislation—which is constantly changing—and practical experience in countering banks, to effectively fight and win disputes with banks on their own.
Many of the aforementioned negative consequences can often be avoided if you promptly involve an experienced lawyer specializing in bank disputes. Such a professional can quickly determine which bank actions are lawful and which violate the law, develop a comprehensive strategy to protect the client’s interests in a dispute with the bank, and effectively implement it.
One of the key areas of activity for Winnerlex Law Firm is the protection of both legal entities and individuals in disputes with banks. With years of successful experience in this field, we have developed effective tools, employing both legal “know-how” and successful negotiation techniques with banks. We continuously monitor legislative changes and analyze new case law, allowing us to apply up-to-date tools to effectively protect our clients’ interests in bank disputes.
Bank Dispute Resolution Services Include:
- Support in drafting, amending, and terminating agreements with banks, including loan and deposit agreements.
- Counteracting banks’ collection of loan debts.
- Reducing loan debt amounts due to incorrect calculations of interest, penalties, fines, and commissions.
- Recovery of deposits with interest for depositors.
- Recognition of loan obligations as fulfilled.
- Invalidating loan agreements.
- Invalidating factoring agreements—sale of debt by the bank to another entity.
- Return of pledged property, contesting foreclosure on collateral, termination of mortgages, and invalidation of mortgage agreements.
- Cancellation of re-registration of ownership by the bank on pledged property, including mortgaged real estate.
- Protecting guarantors’ rights—challenging guarantees, and seeking reimbursement for amounts paid by the guarantor on behalf of the borrower.
- Contesting property valuations.
- Challenging public auctions.
- Legal protection from debt collectors.
- Challenging notary enforcement inscriptions.
- Challenging default court judgments for debt collection.
- Challenging actions and decisions of state and private enforcers and countering debt recovery processes.
- Supporting debt restructuring procedures.
- Resolving credit disputes in the ATO zone.
Practice experience: 19 years
Specialization: litigation support, tax, customs and antitrust practices, agricultural law, IT and M&A
Practice experience: 21 years Specialization: support of economic, civil, labor and administrative disputes, energy
Practice experience: 11 years Specialization: tax, customs and corporate disputes, support of inspections, contractual activities
Practice experience: 6 years
Specialisation: business and civil law, tax and customs practice, corporate law, registration and reorganisation of business
Practice experience: 11 years Specialization: support of economic, civil, labor and administrative disputes, inspections
It is better to involve a lawyer in the process of entering into a contract with a bank, as such contracts are usually lengthy, often written in small print, and use complex legal terms. Additionally, the bank may include strict terms in the contract that worsen the borrower’s position compared to the basic conditions set forth by the law.
If you are considering signing a guarantee agreement with the bank for a loan obtained by your company, business partner, or family members and friends, keep in mind that the bank has the right to collect the debt from you in the same amount as from the direct borrower.
When courts declare loan agreements invalid, they typically pay attention to whether the mortgaged property was transferred to a subsequent mortgage with the consent of the previous mortgage holders, unless otherwise specified in the previous mortgage agreement. A transaction regarding the transfer or assignment of the mortgaged property to another mortgage, joint activity, leasing, renting, or use without the consent of the mortgagee is considered invalid.
The law requires the pledge agreement to indicate the person who is the debtor in relation to the pledgor. The pledgor must inform their debtor about the pledge. A time-bound right of claim owned by the pledgor-creditor can only be pledged until the expiration of its term.
During temporary administration, the claims of depositors and other creditors of the bank are not satisfied, and the offset of reciprocal homogeneous claims is not conducted. However, the introduction of temporary administration, revocation of the banking license, and the start of the bank’s liquidation process do not affect the obligations related to the repayment of loan funds under the concluded loan agreement.
First, it is necessary to thoroughly analyze the terms of the loan agreement. Typically, the loan amount is increased by interest, commission, as well as fines and penalties for late payments, which leads to a significant increase in the debt amount even in a short period. If the calculation of interest, commission, fines, and penalties is incorrect, the borrower has the right to submit their own counter-calculation. Additionally, banks often unilaterally raise the interest rate on loan agreements without informing the borrower. To determine if such an increase in the interest rate has occurred, your lawyer has the right to submit a request for the relevant documents and information, which the bank is required to respond to.
According to the Civil Procedure Code of Ukraine, the court may issue a default judgment if the defendant was notified by the court about the case, but did not appear in court. The defendant has the right to file a motion for reconsideration of the default judgment within 20 days from the date of receiving the full text of the default judgment. Therefore, if the debtor only became aware of the default judgment in the bank’s debt recovery case during the enforcement proceedings, the debtor has the right to ask the court to restore the deadline for submitting the motion for reconsideration of the default judgment. After reviewing the motion for reconsideration, the court may cancel its default judgment and schedule the case for examination according to the general or simplified litigation rules, during which the borrower will be able to present all their objections and evidence against the bank’s claims. If the motion for reconsideration of the default judgment is denied by the court, such a decision may be appealed to the appellate court in the usual manner.
The law provides the bank with the right, under a factoring agreement, to assign the right to claim the debt repayment to other organizations, often referred to as collection agencies. If the conditions set forth by the law are met, the factoring company may have the right to demand repayment of the debt from the borrower specifically to that company. However, first, factoring companies often act against the law in seeking debt repayment, and second, the very fact of the bank assigning the debt to a collection agency is frequently done in violation of the law, which can serve as grounds for declaring the factoring agreement invalid. Therefore, to determine whether the actions of third parties demanding repayment of a bank loan are legal, it is necessary to consult a lawyer who specializes in such disputes.
