The significant depreciation of the ruble last year, as well as a slight decrease in the real incomes of many citizens of the Russian Federation, became significant reasons for the increasing mortgage debt.

Banks report almost monthly an increase in problem debt among creditors, which creates problems for both the financial institution and the debtor. Let's try to answer the question, what to do if you have nothing to pay your mortgage?

Consequences of not paying a mortgage

“If you can’t pay your mortgage: what to do?” - this is exactly the question asked by every payer who does not have the financial ability to pay a mortgage. And, it must be said, the reasons for the debtor’s fears are quite natural: the banking institution uses all possible methods to encourage the borrower to repay the debt. So what happens if you don't pay your mortgage?

1. Fines and penalties for late payments. Almost all mortgage agreements provide for a system of fines for violations by the debtor. It often happens that the amount of fines exceeds the amount of debt itself.
2. Eviction from the mortgaged property. What will the bank do if the delay in payments is significant? He will try to find grounds for the earliest possible eviction of the borrower from the mortgaged property.
3. Seizure of other property of the debtor. Given that real estate prices will continue to fall in 2019, the value of the mortgaged property may not be enough to pay off existing debts. In such circumstances, the banking institution will try to recover from the debtor even that property that was not the subject of the mortgage.

As you can see, the consequences of non-payment of mortgage payments are quite serious. Therefore, all mechanisms to avoid such negative scenarios should be fully used.

Restructuring of problem debts

The main way to legally and peacefully resolve debt problems is through debt restructuring. The correct implementation of this process provides the answer to the question of how to avoid paying a mortgage legally. Restructuring of problem debt allows the bank and the debtor to come to an agreement that allows them to resume payments to the bank on more favorable terms.

A standard restructuring agreement includes:

1. Installment payment. Banks very easily agree to extend payments over a longer period. Their logic is simple: the longer it takes to repay the loan, the more profit the bank will receive. However, the investor also benefits from installments, as this reduces the monthly payment amount.
2. Cancellation of penalties. Almost any restructuring agreement contains a clause canceling all previously accrued fines and penalties. For the bank, a fine or penalty is just a way to motivate the debtor to enter into an agreement, so requests to cancel such sanctions are usually granted.
3. Currency changes and interest rate reductions. The restructuring agreement may contain a provision to reduce the interest rate and (or) change the payment currency. This allows the investor not only to reduce the actual amount of payments, but also to neutralize the risks associated with a possible further devaluation of the national currency.
4. Registration of credit holidays. In some cases, the debtor needs a pause to resolve his affairs, after which he can repay the loan. Therefore, many restructuring agreements include a provision for credit holidays, during which the debtor pays only interest on the loan or is temporarily exempt from making such payments on a legal basis.
5. Write off part of the debt. The most controversial clause of the restructuring agreement is the provision for writing off part of the debt under the mortgage agreement. The bank, as a rule, is not particularly willing to enter into an agreement to write off part of the debt, however, the risk of receiving bad debt, which cannot be fully covered by the mortgaged object, often forces the financial institution to make compromises

Alternative ways to resolve disputes with banks under mortgage agreements

In some cases, even the bank’s loyal conditions cannot satisfy the borrower who is unable to repay the resulting debt. In this case, the borrower thinks about how to refuse the mortgage and return the money. However, the practice is that at least part of the money can be returned if the borrower has already paid more than two-thirds of the cost of the apartment.

In this case, by agreement with the bank, the apartment can be sold. The bank will take its part, and the remaining funds will be credited to the borrower's account. Unfortunately, the value of real estate in the Russian Federation has fallen significantly, so there is no guarantee that the sale of real estate at current prices can even cover the amount of debt the debtor owes to a financial institution, not to mention compensating him for part of his funds.

Another option is to rent out the property. If the borrower has a place to live, he can, in agreement with the bank, rent out his property. Rent payments, especially if installment debt is used in parallel, allow the owner of the premises to practically not spend money on loan repayments, using rental income for this.

Obviously, there is no universal answer to the question: “I can’t pay my mortgage, what should I do?” However, current legislation provides a number of ways to reduce the debt burden on the borrower and at least partially solve the problems he has.

Video: Representative of VTB 24 bank about what to do if you have nothing to pay your mortgage

In Russia, according to statistics, almost 30% of the adult population has bank loans, which are gradually repaid. However, cases are different, and no one is immune from a situation where it is impossible to pay a loan. We will discuss further what to do when faced with the problem of inability to repay a debt to a creditor.

Reasons for the insolvency of borrowers

When a person applies to a bank to obtain a loan, he undergoes a special check, a scoring analysis. This is how the lender tries to verify the solvency of a potential client. The documents submitted to them and their credit history are carefully studied. But in any case, issuing loans is always a risk for the bank. Borrowers often show negligence and irresponsibility, ignoring their obligations to bankers, and there are quite compelling and respectful arguments for their insolvency. For example:

1. Loss of a job – staff reduction, liquidation of an enterprise (except for leaving at one’s own request or due to a violation of the Labor Code of the Russian Federation).
2. The birth of a child, going on maternity leave.
3. Death of the breadwinner.
4. An emergency is a fact of burnt real estate, house, office, etc.
5. Serious illness, accident.
6. Urgent relocation, etc.

Naturally, you will need to document your insolvency. Not a single bank (Sberbank, VTB, etc.) will revise the terms of lending to a problem debtor without an appropriate request and certificates confirming the financial crisis.

What to do if you can’t pay your loans?

So, you have become a victim of difficult financial circumstances; you cannot pay your loans, and you have no idea what to do. The first thing you need to do is contact the creditor to explain the current situation and negotiate. Hiding and trying to resolve the problem yourself is not recommended. The consequences for the borrower can be very dire, but more on that a little later.

Borrower rights

Having in hand documents confirming your insolvency (extract from the work book, sick leave, death certificate of the loan payer, etc.), the borrower has the right to claim the following concessions from the bank:

Bank actions	Varieties and features
Payment deferment	In terms of interest, it is beneficial for the borrower, less profitable for bankers. Only the body of the loan can be repaid within the agreed time. As a result, the total overpayment on the loan can be significantly reduced.
	Regarding the loan body, banks often agree to carry out this program. The deferment can be 12 months, during which only interest on the loan will be paid, and the body of the loan will be paid later (depending on the agreement). This increases the loan term and the overpayment of the loan.
	Full deferment – ​​provided for no more than 3 months. During this time, you do not need to make payments at all.
— change of terms and conditions in the loan agreement	Increasing the loan term (loan extension) - the monthly loan payment decreases, but the total overpayment amount increases.
	Changing the currency - this method is advisable when there is a sharp change in the exchange rate.
	Reducing the interest rate is an option if the borrower has an ideal credit history.
Loan refinancing	Applying for a new loan with favorable terms in order to pay off problem debt. You can get it from many banks in the country or consider special programs from “your” lender.

Consequences of debt

Continuing to discuss the question of what to do if you have nothing to pay a loan with, it is worth explaining to debtors what the consequences of failure to fulfill their obligations to creditors are. We note that according to Russian legislation, criminal liability may arise for non-payment of a loan, but in some cases (fraud, forgery of documents, etc. - Article 159 Part 1 of the Criminal Code of the Russian Federation, malicious evasion of debt repayment - Article 177 of the Criminal Code of the Russian Federation).

The bank also has the right on the basis of Art. 23 and art. 27 Federal Law No. 395-A to apply a form of recovery by seizing the borrower’s accounts and property (by court decision). An overdue loan will also lead to the following consequences:

1. Damaged credit history. Even the fact of a slight delay (up to 30 days) will be reflected in the credit file. In the future, problems and restrictions may arise when obtaining a new loan.
2. Constant worries from the bank - calls, SMS, email notifications reminding you to repay the debt.
3. Accrual of fines and penalties, which will lead to an increase in debt.

Banking organizations are permitted by Law No. 353-FZ, clauses 1-2 of Art. 12 carry out assignment of rights under the agreement, i.e. sell the debts of problem borrowers to collectors, unless the loan agreement contains a direct prohibition. The last stage of pressure on the debtor can be a court, by which the borrower has a high chance of losing property, real estate, and other valuables, or vice versa - to achieve certain concessions in the form of restructuring, writing off fines, etc.

Failure to pay bills or absconding in the future may result in the inability to:

1. If you buy a car or real estate, they can take it for debts (information about the purchase is available in Rosreestr).
2. Opening a bank account - the account will be blocked, any money on it will be written off.
3. Officially get a job - tax deductions will occur, the employer will be obliged to contribute part of the debtor’s earnings to repay the loan debt (no more than 50% of the salary).
4. Register a marriage – property acquired during marriage, acquired, for example, in the name of the other spouse can be withdrawn (partially).
5. Travel abroad - if the bailiff has restricted travel, you cannot even buy a ticket at the railway station.
6. Make permanent registration at the place of residence with the exception of temporary registration.

In general, as we see, the consequences for the debtor are very severe.

What should a borrower do in a crisis situation?

Realizing that your financial situation is getting worse and you are unable to pay your loan on time, contact your lender. Do this in advance, without waiting for crazy fines, penalties, or specialists to go to court or. The fact is that if the borrower has a good credit history, the bank is more willing to make concessions, agree to deferment, restructuring, and refinancing of the loan.

During negotiations with the bank, highlight the content of your problem and offer possible solutions. You can provide your personal property and valuables as loan repayments. To formally contact the bank, you will need to write an application in any form. You can see the approximate text of the document here.

Well, if the matter comes to court, have patience and courage. Perhaps now you will have a chance to get rid of problem debt, but on the condition that you really cannot fulfill your obligations to the creditor.

Cases when you can not pay your loan?

It turns out that a bank can write off a bad debt (on its own or by decision of the courts), having chartered to engage in attempts to return it. This is possible when the following circumstances occur:

1. The amount of debt is small. Sometimes it is more profitable for a creditor to write off a debt than to pay legal costs.
2. The location of the problem client is unknown.
3. During the inspection, it was established that the borrower has no property, bank accounts, or work, and he cannot repay the debt.
4. The debtor died, and the relatives refused the inheritance (including debts).

Now let’s look at what ways there are to not pay a loan legally:

1. Contact the insurer with whom you have a disability insurance contract (if any).
2. . On this basis, an individual has the right to declare himself an insolvent citizen if certain requirements are met: the amount of debt is from 500,000 rubles, the overdue period is more than 3 months. However, be prepared that after that you will not be allowed to leave the country for several years, occupy leadership positions, and other restrictions.
3. Wait until the statute of limitations expires. Is 3 years. It is not recommended to resort to this method on purpose, but if you decide to take a risk, be patient, do not sign anything, do not make any payments, otherwise the countdown of overdue days will start all over again.

Some "brave" people use certain scams. They transfer their property in advance to the name of, for example, a close relative, but such transactions are easy to identify during court proceedings. Do not play with fire, behave honestly with the creditor, the laws of the Russian Federation are capable of protecting even the most problematic debtor.

When applying for a loan, few people think about the fact that due to a lack of money there may be problems with repaying the loan in the future. Therefore, few people look in the bank agreement to see what commission will have to be paid in case of delay, and what amount of fines will be accrued. And for the borrower, these consequences and amounts become not just unexpectedly high, but fabulous, and delinquencies arise.

At the same time, the debt grows, worsening the already unenviable situation of the debtor - the consequences can be the most unenviable. True, economists claim that in the absence of opportunities to repay bank loan debt, there is a way to minimize the consequences. This will minimize the cost of money and time.

What to do if you can’t pay your loans and there are arrears

We'll figure out what to do if you can't pay your loan and are in arrears. To avoid unpleasant consequences, the borrower needs to come to the bank as soon as possible and honestly say about the lack of funds.

A financial institution employee may recommend:

Restructuring is a good opportunity to reduce the amount of monthly payments to the bank in order to repay them over a longer period. But it is necessary to understand that the consequence of such a decision will be an increase in the total overpayment on the loan, because interest should be paid directly for the period when the client uses the loan. In this case, the delays will be counted towards the total amount of the debt, and penalties will no longer be charged.

You can take a credit holiday - a good opportunity and a kind of vacation, during which you can only pay interest, and not the amount of the principal debt and arrears. During this period, no fines or commissions are charged. But you need to understand that this does not solve the problem, but only postpones unpleasant consequences for some time. And this option is suitable for those people who plan to urgently find a new high-paying job in a few months in order to restore the ability to pay their bank accounts.

What to do if you can’t pay by credit card

Today everyone has a credit card (and often more than one). And the ability to pay a bill at any time sometimes leads to undesirable consequences - a person ends up in a debt trap. After all, the amount withdrawn from a credit card may exceed the financial capabilities to repay the loan. It is also unexpected that the bank charges not only interest on the card, but also fines for late deposits.

In such a situation, we can recommend applying for a new loan from a bank (carrying out a refinancing operation) - in particular, it can be taken out from another credit institution. This is an excellent opportunity to stop the accrual of arrears, immediately pay off the accumulated debt with fines, and then pay off the debt on a new loan in equal payments.

What to do if you can’t pay a loan from Sberbank

Although this bank allows you to easily get money to purchase the desired goods or real estate, it has an extremely negative attitude towards non-payers. Therefore, this Sberbank sets fines for late payments no less than other organizations.

The options for getting out of the situation are the same here - this is the opportunity to agree on restructuring or refinance, that is, take out a new loan to pay off the old one. At the same time, it is important to understand that the next loan must be repaid in a timely manner, otherwise unpleasant consequences may arise in the form of delays, penalties and fines.

What happens if you can’t pay a loan to several banks?

A particularly unenviable situation is for those borrowers who have taken out several loans from different banks - for example, consumer, mortgage and credit card. If a person loses his job or is simply undisciplined in his financial obligations to the bank, then arrears and debts due to fines will increase for all loans at once. These unpleasant consequences can be avoided by using the following methods:

Compare your income and expenses. This technique often helps: write down all your income on one sheet of paper, indicate below the real expenses for housing, food and other necessary needs, you should also write down what day of the month and how much you should pay on loans. Then you need to analyze whether you can refuse some expenses in favor of paying off the loan. Very often it turns out that even with relatively large incomes, money is used irrationally.

The second option is to refinance. This is an excellent opportunity to take out a new loan from a bank at attractive interest rates. In addition, it is always more convenient to pay off payments once a month, rather than watching the numbers so as not to miss several payments. This payment standard is accepted in economically prosperous countries.

There is no possibility to pay the loan while on maternity leave

Another unpleasant consequence may await young mothers who have taken maternity leave. After all, a woman can have a well-paid job, but with the birth of a child she will lose her usual high level of earnings, which causes difficulties in making loan payments. And the question arises: “If I can’t pay the loan, what should I do?”
There may also be several possibilities to resolve the situation:

• Due to the deterioration of your financial situation, you can contact the bank to restructure the loan. As a rule, you will need to contribute an amount feasible for the young mother, which is calculated based on the real income of the family;
• If the debts in the bank have accumulated very large, and the income leaves much to be desired, then you can mortgage or sell the property to repay the loan.

This, of course, is not the best consequences for the borrower, but if no action is taken, the bank may sell the case to collectors or take it to court. And this can also result in the sale of movable or immovable property - completely unenviable consequences.

No way to pay the loan - consequences of 2018

So, if it is not possible to pay the loan, the consequences for individuals according to the law may be:

• Increasing debt due to the accrual of penalties and fines;
• Selling the case to collectors if the borrower does not want or cannot pay his obligations for 3 months or more;
• Transferring the case to court - the consequences may be in the form of obligations to repay the debt within a certain period.

If the borrower cannot do this, he may be declared bankrupt or his property may be sold off. Although a trial is also an opportunity to write off excessively accrued commissions.

Nowadays, unfortunately, in order to make a major purchase, many of us need to apply to the bank for a loan. Now each bank is able to offer its potential borrowers dozens of different lending programs on completely different conditions from each other. However, not all borrowers are aware of the fact that even despite favorable loan conditions, banks do not give them borrowed funds, but only lend them money for a while, for which they still have to pay.

What to do if you can’t repay the loan

Due to their financial illiteracy, borrowers very often suffer, as they are faced with a situation where they simply have nothing to pay for the loan. There can be many reasons for this: job loss, health problems, accident and much more. But whatever the reason, you still have to pay off your debts. The only question is how exactly this will have to be done. When a similar situation occurs, and the real opportunity to repay a previously taken loan disappears, the borrower needs to contact the bank and report the circumstances of the case in order to resolve the problem amicably.

Running from the bank, hiding, delaying repayment is a useless matter and fraught with very serious consequences, since sooner or later the debtor will be found and the entire debt will be collected from him with the penalties accumulated for each day of delay, and in the worst case, the matter may go to court and confiscation of property. In general, as soon as difficulties arise with repayment, the first thing to do is immediately contact your bank.

The credit institution, in turn, will help find a mutually beneficial compromise and offer the debtor a couple of options for solving the problem.

Notify the bank

And so, if the borrower has a problem with payments, he needs to inform the bank about it. Managers of the institution will study the debtor’s situation and offer him to restructure the debt that has arisen. That is, the bank will simply revise the payment schedule in favor of the borrower. This could be a reduction in the amount of monthly deductions, an increase in the loan term, etc. In this case, the old terms of the credit agreement are canceled, and a new agreement is concluded on new terms that will be beneficial not only to the bank, but also acceptable to the debtor himself. After all, the bank will still return its money, and the borrower will be able to repay the debt, but on completely different conditions. Moreover, in this case, the borrower’s credit file will not be spoiled by negative entries about late loan payments.

Credit holidays

The financial and credit organization is primarily interested in the borrower returning his entire debt with the established interest. Therefore, she will try in every possible way to find a compromise acceptable to both parties, just to return the funds and not bring the matter to court. An excellent solution would be to provide the debtor with so-called “credit holidays”, the essence of which is that the debtor is given a deferment of loan repayment for a period of one month to six months.

At the same time, the debtor will not need to pay anything within these terms, and the bank will not apply any sanctions to him either. During the period of the credit holiday, the debtor can easily resolve all his financial issues (for example, get a job or improve his health) and start paying off his debt to the bank. The only drawback of this option is that the debtor will have to prepare for a slightly increased cost of the loan, since the bank, by making such concessions, increases the period for the borrower to use the loan funds.

Refinancing

Another adequate solution to the problem is refinancing the existing one, that is, refinancing. Simply put, the borrower is looking for a reliable bank that will agree to transfer his debt to himself. After this, the new bank gives the borrower a new loan, which goes towards repaying an existing debt in another bank. In general, the essence is that the borrower takes out a new loan to pay off an old debt. Moreover, in most cases, the refinancing credit institution provides a new loan at a lower rate than the bank from which the debtor took the loan earlier.

Sale of collateral

In addition, if the debtor took out a loan secured by real estate (or, for example, a car), he can use it to pay off the existing debt. It should be taken into account that if the debtor decides to independently repay the entire debt to the bank by selling the collateral, penalties and fines for late payment of the loan will not be calculated from him. The biggest disadvantage in this situation is that the borrower will have to lose the collateral and most of the proceeds will have to be returned to the bank.

Find a guarantor

If the borrower has the opportunity, he can attract a solvent guarantor who will take on all his loan obligations. This, of course, is a very difficult option, since finding a person who wants to take on the debtor’s financial problems is very problematic. But if there is such an opportunity, then you should definitely take advantage of it.

It often happens that there is a loan, but no money. What will be the best in this situation?! Avoid communication with bank employees or contact them yourself, warning them of an impending problem? Is there a way out of this situation? The material will discuss legal ways to defer payments on existing debt.

Controversial issue

There is a lot of information on the Internet that gives debtors hope, informing them about many ways to defer payments for a loan. However, unfortunately, there are not many legal and working methods.

The first myth (the most common) indicates that banks are willing to provide deferred payments, in return increasing the interest rate on the “body” of the debt, thereby increasing their profits. The myth is easily dispelled. Thus, having informed the bank about the desire to take a deferment, the client immediately ends up on the “black list”, which does not bode well for him in the future. Even if the client copes with this debt, he will be haunted by a damaged credit history in the future. Once a client finds himself among the ranks of insolvent payers, the bank no longer considers a situation in which it can receive even greater profits from such a client. The bank looks at the situation from a pragmatic side, wanting to return at least something of its money, fearing to remain in the red. Ideally, of course, the bank wants to return all its funds and interest. Therefore, to say that banking organizations sleep and see when an insolvent debtor comes to them is, to say the least, incorrect.

However, such deferments still take place, but each case is considered by banking organizations separately. By the way, a lot depends on the banking organization. For example, if the debtor is a long-time client of the bank and has no late payments, then the bank may make concessions. That is, it is important to remember that the current situation is not a standard situation, but rather a bank concession. As you know, the bank is a “conveyor” structure, working according to a pre-established scheme, so everything that falls outside the scope of the “standard situation” is viewed in a negative way, unless, of course, this situation is spelled out in the loan agreement.

The loan agreement may provide for the client’s temporary financial problems and instructions appropriate to the situation. As a rule, the algorithm of action for such a situation is to provide a deferment on the payment of interest or the principal of the loan. That is, either temporary repayment of only the debt on the “body” of the loan, or temporary payment of interest alone. In addition, a justification for the need to provide such “benefits” will probably be required. They may be, for example, documents indicating a temporary delay in wages or illness.

The second myth points to the ease of obtaining a new loan to repay an old (problematic) one. Here the Central Bank of the Russian Federation appeals to the myth, which, according to paragraphs 3.7.2.4, 3.7.3.3 of the Central Bank of the Russian Federation Regulation No. 254-P, imposes a ban on repaying a loan with borrowed funds. Banks, naturally, are in no hurry to go against the direct installation of the Central Bank, especially during the period of active revocation of banking licenses. However, there is some truth in the myth. So, despite the fact that banks are prohibited from issuing new loans to repay old ones, banks are using a “loophole” in the instructions, issuing new loans under the “sauce” of improving credit conditions, which does not contradict the guidelines of the Central Bank.

But the most important problem is that the problem cannot be solved by taking out a new loan, because it also needs to be repaid.

The third myth advises declaring yourself bankrupt as a lifeline. Yes, the law provides for bankruptcy of individuals, but it will be extremely difficult to prove this. Here it is worth taking into account the bank’s interest in proving the opposite and the already established judicial practice. As a rule, the bank wins such lawsuits in 90% of cases, and the losing party (client) is not only obliged to pay the debt in full, but also incurs costs associated with paying for legal services.

Do “bank holidays” occur in nature?

It is important to know. In any case, if a problem situation arises, the client must be the first to contact the banking organization and explain the situation. This measure will have a greater chance of obtaining concessions from the bank than concealing and avoiding responsibility.