Collection of debts secured by acknowledgement letters and loan agreements
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Lend your money and lose your friend.
Let’s figure out how not to lose your money at least and what to do if there is a problem.
Debt acknowledgement letter
A debt acknowledgement letter is a hand-written or printed document drawn up in free form. A debt acknowledgement letter states that one person has borrowed a certain amount of money from another person and has to return it before a certain deadline.
In order to be valid in court, this letter must contain the following information:
- Full name, passport details, tax ID and address of the debtor.
- Full name, passport details, tax ID and address of the lender.
- The phrase “…received the loan…” which confirms that the person has borrowed the money.
- The amount of debt, written in numbers and letters.
- Currency of debt. Art. 533 of the Civil Code (part 1) provides that all loans in Ukraine are issued in UAH. You can also specify the USD or EUR equivalent so as not to lose money if the rate goes up.
- Date of drawing up the letter and returning the debt.
- Interest rates and penalties.
You should insist that the debtor writes their surname and signs the letter by hand. In some cases, debtors refuse to admit in court that they have borrowed anything at all, then the court appoints a handwriting expertise. If it confirms that the handwriting belongs to the debtor, they will have to pay.
The Decision of Supreme Court of Ukraine No. 6-79 sub item 14 as of 2 July 2014 once again recognizes the equal status of loan agreements and debt acknowledgement letters, and confirms that the violation of the terms of debt acknowledgement letters entails financial penalties.
But, if the amount of debt exceeds 10 non-taxable minimums, or when a lender is a legal entity, one has to enter into a loan agreement.
This document is one level higher than a debt acknowledgement letter and has a certain layout. You can draw it up with the help of an attorney.
How to claim a debt secured by a debt acknowledgement letter or a loan agreement
You can sue on the fourth day of delay in debt payment. But we recommend the following scheme: remind the person about the debt in oral form – sometimes people simply forget about their obligations. If the debtor gives no answer for three days after that, send them a letter with a request to pay the debt. This letter will confirm the fact that you have tried to solve the matter peacefully in case it comes to trial.
If the debtor does not return the money after receiving the letter, file a lawsuit.
Debtors can also become the injured party. For example, if they return the debt, but do not ask for a receipt acknowledgement letter from the lender which proves that the money has been received. The lender keeps on demanding the debt. To prevent this from happening, confirm any money movement with a relevant letter or an account receipt. Otherwise, if it comes to trial, you will have to pay the debt again.
When you need an attorney
You need an attorney at the stage of drawing up a letter or a loan agreement. The attorney will go through the details and draw up the document that will protect your rights.
If the payment deadline has approached, but you still have not received your money, we will file a suit and represent your interests in court.
We also work on the cases of debtors who have paid the debt, but keep being accused of not returning the money.
Getting the court decision is only half the battle. The main difficulty is to implement it. We always end what we have started: we control execution of the decision until you get the full amount of your money.
In each case, we remember: if you have lent or borrowed money from someone, it means that you used to trust this person. We will try not only to return the debt, but also help you to stay friends.
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