When a customer borrows money, the bank has to fulfill the debt repayment obligation according to the signed contract. If you do not pay, the bank will sue you in court. So how much is the bank’s debt to be sued and for how long? Today, LSX Lawfirm will give you an article about “How much bank debt can be sued according to Vietnamese law?”, as follows:
Legal grounds
Civil Code 2015
What is a bank?
A bank is a financial institution authorized to accept deposits and make loans. Banks may also offer financial services such as wealth management, currency exchange, and safe deposit boxes.
There are several different types of banks including retail banking, commercial banking, corporate banking, and investment banking. In most countries, banks operate under the supervision and regulation of the national government or the central bank.
Features of the bank
Banks are a very important part of the economy because they provide important services to both consumers and businesses. As financial service providers, they provide a safe place to store customer cash.
Through a variety of accounts such as checking accounts, savings accounts, and certificates of deposit (CDs), a person can perform common banking transactions such as depositing, withdrawing, writing checks, and making payments. receipt. A person can also save his money and earn interest on his investment.
Banks do this by charging more interest on loans and other debt they issue to borrowers than they pay to people using their savings vehicles. A simple example is as follows: a bank that pays 1% interest on savings accounts and charges 6% interest on loans earns 5% interest to the owner.
These banks often offer consumers higher interest rates and lower fees. Convenience, interest rates, and fees are some of the factors that help consumers decide on their preferred bank.
How much bank debt to sue?
The Borrower is obliged to pay the Lender, if the Borrower does not pay the debt, the lender has the right to sue the Borrower in Court to force them to pay. As can be seen, the law does not stipulate the amount of money to initiate a lawsuit, but only at the request of the petitioner (ie the bank) in accordance with the order and procedures of the law, the Borrower will be sued.
Normally, when the Borrower does not have enough conditions to repay the loan, the bank will not initiate a lawsuit immediately but will give the Borrower an extension of time to repay the debt. When the Bank extends the grace period but the Borrower still has not paid the debt, these debts will become bad debts.
How much do you owe the bank to sue?
When taking a loan, all loan and repayment history during the loan process will be collected and stored by CIC. Based on this information, banks and financial companies can classify debt groups and customers.
Debt group 1 (Qualifying debt)
These are groups of light debt that can be remedied and written off immediately. Those whose loans are overdue for less than 10 days will be classified as group 1.
Group 2 debt (Debt needs attention)
The loan is past due from 10 to 90 days.
The debt has been rescheduled for the first time.
Group 3 debt (Subprime debt)
The debt group has a delinquency period from 30 to 90 days.
The debt group has restructured the repayment period for the first time, but it is overdue for 30 days.
Debts are exempted or reduced interest rates due to insolvency.
Group 4 debt (Debts suspected of losing capital)
The debt group is overdue for payment from 90 to 180 days.
The debt group restructured the repayment period for the first time but was overdue from 30 to 90 days.
Restructure the 2nd debt repayment period.
Group 5 debt (debts likely to lose capital)
Group of debts that are overdue for 180 days or more.
The restructured repayment period for the first time but overdue for 90 days.
And The restructured repayment period for the 2nd time but still overdue.
Restructuring the 3rd debt repayment period.
Based on the current actual situation, bad debt is divided into 5 levels based on the delay in loan payment of customers. The levels of bad debt are numbered from 01 to 05, equivalent to the level of bad debt gradually increasing. It can be said that this level does not depend on the amount of money the customer borrows, but on the time of delay in repayment.
Customers with bad debt from level 3 onwards will not be able to borrow money from any other bank or credit institution, regardless of any form of debt. In addition, in order to delete bad debt information on the National Credit Center’s system, customers need to wait 60 months from the date of completion of all debts. For customers with bad debt groups 1, and 2, the time to write off debt is shorter than only 12 months.
In case, the late payment time of the customer’s debts exceeds the level of 05, in the process of the Bank’s debt collection, the Borrower has a negative attitude, does not cooperate, and does not want to pay. The Bank has the right to collect information, documents, and evidence and send it to the competent Court for the Court to prosecute the borrower’s illegal acts, forcing the borrower to return the loan amount to the Bank row.
Bank debt being sued can be punished for how many years in prison?
Bank debts that are sued if they fall into one of the following cases will be sanctioned according to Article 175 of the Penal Code 2015 amended and supplemented with 2017 on Crime of abusing trust to appropriate property:
Depending on each act, the law sets out different penalty frames for those acts. Specifically:
– Firstly, For the basic penalty frame, the minimum penalty is non-custodial reform for up to 3 years or a prison term of between 6 months and 3 years.
– Secondly, For the aggravating penalty bracket, the prison term may range from 2 to 07 years.
Committing the crime of appropriating property valued between VND 200,000,000 and under VND 500,000,000; the offenders shall be sentenced to between 5 and 12 years of imprisonment.
Committing the crime of appropriating property valued at VND 500,000,000 or more, the offenders shall be sentenced to between 12 and 20 years of imprisonment.
The offenders may also be subject to a fine of from VND 10,000,000 to VND 100,000,000, a ban from holding certain posts, practicing certain professions or doing certain jobs for 1 to 5 years, or having part or all of all confiscated assets.
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Related questions
If the borrower is able to repay the debt but fails to pay it but deliberately uses deception or flees, the borrower may be examined for penal liability for the crime of abusing trust to appropriate property specified in Article 175 of the Penal Code. 2015, amendments and supplements in 2017.
Clause 1, Article 317 of the 2015 Civil Code stipulates that a mortgage of property means the use of the property by a party to secure the performance of an obligation and not handing over the property to the mortgagee. Thus, the mortgaged property must be owned by the person bringing the mortgage. Property being rented or borrowed can only be mortgaged in case the owner of such property agrees to let the lessee mortgage it. Tenants cannot arbitrarily mortgage the rented or borrowed property.
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