They called loans secured by the borrower no longer be properly repaid, as Non-performing loans. In such a case the lending bank in the first place is keen to keep any loss to a minimum or avoid them altogether.
To this end, certain steps are carried out. First Bank Announces the non-performing loan and therefore it is due before the date originally agreed to repay. The borrower is requested in writing to repay the outstanding loan debt in a sum within a specified period. If not, the bank can now collateral that the borrower has provided, to exploit the benefit of non-performing credit. As a safety can for example a life insurance ceded or pledged assets will be used.
The recycling is done either by withdrawal of the claim or liquidation of the insurance. If bad loans, however, can not be offset by the existence of collateral, or if the recovery does not cover the entire loan debt, the bank must resort to a foreclosure. This requires the bank to the court an enforceable purchase that allows her to push through with the help of a bailiff its claim against the debtor of the non-performing loan.
The bailiff has the right to recover by seizure of property and valuables, the credit debt. Even the wage claims of the debtor’s credit up to a certain percentage be seized and used for the eradication of non-performing loan.
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Tags: bad loans, bank, debt, insurance, loan, loan debt, Loans, Non-performing loans