The latest provision to remedy the economic uncertainty caused by the coronavirus epidemic is available from the 28 October. The Act CVII of 2020 enters into force on the 1th January 2021, when the loan payment deadlines specified in the previous law on Credit Repayment (Government Decree No. 47/2020. (III. 18.)) expire.
The credit repayment moratorium helps those belonging to the so-called prioritized social groups after 31 December 2020, until 30 June 2021.
Anyone might take advantage of it who is
- unemployed (only those who are registered job seekers),
- expecting or raising a child (under 25 years of age, dependent person)
- pensioner or
- public employee.
If the debtor belongs to the above mentioned groups, then they get an extension of the due date until 30 June for all payment obligations (including interest and service charges). It is important to emphasize that the law does not terminate the obligation to pay, it does not mean „forgiving the debt”, only the due date for payment is extended due to the epidemic situation.
If the debtor can afford it due to their financial situation, they are allowed to pay off the debt, but they may decide at any time to take advantage of the moratorium. In the case of codebtors, it is sufficient, if one of them belongs to any of the prioritized social groups.
The creditor may not add the interest not paid during the moratorium to the amount of the debt later. The interest accrued at that time must be collected later, in equal annual installments over the term. Another important detail is that the repayment term is then extended so that the amount of the installment to be paid and the interest does not exceed the installment under the original contract.
The same advantage applies to participants in the Nemzeti Eszközkezelő Program (NET). Both rent payers and those who have undertaken to purchase the property in installments will receive a deferral of payment of the rent and the purchase price installment. In this case, the original payment deadline is automatically extended by the grace period used.
The moratorium on loan repayment is also available to those involved in debt settlement proceedings.
The prohibition on termination of credit agreement applies to all debtors who have lost their financial security as a result of the epidemic and are therefore unable to pay their debts. It is important that the regulation only applies to credit and loan agreements granted on a commercial basis, so that the claimant is always a financial institution, such as a bank or credit institution.
The prohibition on termination of credit agreement means that the creditor cannot terminate the contract simply because the debtor has failed to pay the installment, interest or any service charge. This postponement lasts until 30 June 2021. The law emphasizes that, if necessary, the credit institution is obliged to consult with the debtor and to help them to restore their solvency. It is possible to amend the original agreement to include more favorable performance conditions, longer payment deadlines or installments, or to reduce the amount to be paid itself.
This provision does not provide an exemption from the payment of the installment, it merely seeks to facilitate a dialogue between the debtor and the creditor, as it is in the interest of both of them that the debtor remains solvent.
If you have any further questions, please contact the Utcajogász by e-mail at firstname.lastname@example.org.
Fordítás/Translated by: Kun Kata, önkéntes/volunteer